Samsung profit misses estimates on weaker S6 smartphone sales

A salesperson cleaning the floor at a Samsung showroom in Jakarta.
A salesperson cleaning the floor at a Samsung showroom in Jakarta.PHOTO: REUTERS

SEOUL (BLOOMBERG) - Samsung Electronics posted second- quarter profit that missed analysts' estimates as shortages of new smartphone models made it harder to lure customers back from Apple Inc.'s iPhone and cheaper handsets made in China.

Operating income fell 4 per cent to 6.9 trillion won in the three months ended June, the company said in a filing Tuesday. That compares with the 7.2 trillion won average of 33 analyst estimates compiled by Bloomberg.

Samsung's Galaxy S6 smartphone sales have fallen short after winning early praise as a device that could lure users that had shifted to Apple's larger iPhone 6. Production constraints for the S6 model with a curved display have led to shortages, trimming sales of the device.

"Market expectations for S6 sales were way too excessive," Yoo Eui Hyung, an analyst at Dongbu Securities Co., said in Seoul before the earnings release.

"Analysts are revising down this year's shipment forecasts for the S6 because demand for the Edge model is exceeding supply, while the other version isn't selling well given its limited differences with the iPhone 6."

Sales were 48 trillion won in the quarter, the company said today. That compares with the 53 trillion-won average of 37 estimates.

The company's shares closed at 1,230,000 won on Monday in Seoul. The stock has fallen 7.3 per cent this year after dropping 3.3 per cent in 2014.

Samsung didn't provide net income or details of division earnings today. Audited results are scheduled for later this month.