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Samsung’s Q3 profit nosedives, stock soars

Samsung Earnings Q3 2014

Investors sent Samsung shares soaring more than 4.5% on Thursday as the company reported dismal third-quarter earnings… that were thankfully less dismal than analysts were expecting. In a world where the high end of the smartphone market is being squeezed by more capable mid-range and low-end phones, Samsung’s response has been to flood the market with cheaper low-margin phones. How did that work out? In the third quarter, Samsung’s operating profit plunged 60% on year to $3.9 billion and its revenue slid 20% to about $44.6 billion.

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One tweet from mobile analyst Horace Dediu says it all:

Samsung wasn’t shy in admitting that its smartphone business has weakened significantly as increased competition from Apple at the high end and from Chinese smartphone makers at the low end makes it increasingly difficult to thrive. The company did say that it still “cautiously” expects holiday-quarter earnings to improve as TV sales increase, however.

Zach Epstein

Zach Epstein has worked in and around ICT for more than 15 years, first in marketing and business development with two private telcos, then as a writer and editor covering business news, consumer electronics and telecommunications. Zach’s work has been quoted by countless top news publications in the US and around the world. He was also recently named one of the world's top-10 “power mobile influencers” by Forbes, as well as one of Inc. Magazine's top-30 Internet of Things experts.




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