epa06919696 A view of the Samsung Electronics head office in Seoul, South Korea, 31 July 2018. The tech giant announced its second quarter performance on the day, showing net profit down 0.09 percent on-year with weak smartphone sales but quarterly record profits in the chip business.  EPA/YONHAP SOUTH KOREA OUT
Samsung Electronics head office in Seoul, South Korea. Company's results have missed estimates. EPA

Samsung income falls as golden days for its smartphone may be over



The slowdown in the global smartphone market is starting to take a toll on Samsung Electronics.

The South Korean company’s net income fell short of analysts’ estimates as the sluggish market hit demand for its Galaxy devices, even as Chinese rivals step up their competition. Net income was 11 trillion won (Dh35.99 billion) in the three months ended June, compared with the 11.6tn won average of estimates compiled by Bloomberg.

The results reflect Samsung’s troubles in shoring up its mobile business, despite resilient demand for its memory chips. Shipments in the smartphone market are declining after years of rapid growth, while China rivals such as Huawei Technologies and Xiaomi are grabbing more market share. Chinese competitors are also threatening the South Korean company’s display business with products ranging from cheaper televisions to state-of-the-art smartphone screens.

“Consumers are losing the belief that the next version of a smartphone is actually smarter,” said Paul Swiercz, a management professor at George Washington University. “Even those wanting to own the latest and greatest are having difficulties paying high-margin prices for performance and features that have topped out.”

Operating profit rose to 14.9tn won on sales of 58.5tn won, Suwon-based Samsung said, confirming preliminary numbers released earlier this month. The Korean won rose against the euro and several other key currencies, resulting in a negative impact of net 400bn won on the quarterly operating profit compared with the previous quarter. The company’s tax bill also rose to about 28 per cent of pretax net income, five percentage points higher than a year earlier.

Huawei reported Tuesday that its revenue rose 15 per cent for the first half of the year, without breaking out results for its smartphone or other divisions.

“They have a very aggressive Huawei to deal with,” said Cliff Maldonado, an analyst at BayStreet Research in San Francisco.

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Read more:

Apple results and iPhone performance in spotlight

Samsung bets big on winning the Indian smartphone manufacturing race 

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In China, the biggest market for semiconductors, Samsung faces an investigation over allegations of collusion in chip business along with SK Hynix and Micron Technology. The three companies control more than 90 per cent of the market for dynamic random access memory, or DRAM, chips.

Operating income from the chip unit amounted to 11.6tn won, accounting for the lion’s share of profit.

Contract prices for 32-gigabyte DRAM server modules climbed 2.8 per cent in the June quarter from the March period, which saw them rise 5.6 per cent. Prices for 128 gigabit MLC NAND flash memory chips fell about 9 per cent, according to inSpectrum Tech.

Samsung shares fell less than 1 per cent after the results. The stock has declined about 9 per cent this year after trading near record highs in 2017 when the world’s biggest chip maker posted record profit on demand for semiconductors used in everything from data servers to smartphones.

Display panels make up another part of revenue for Samsung, which supplies OLED screens to Apple for its iPhone X even as the two sides compete in the premium phone market. Samsung’s operating profit from its display business was 140bn won, down from 1.7tn won a year earlier.

With growing competition from China, Samsung’s smartphone division posted 2.7tn won in operating profit, down from 4.1tn won a year earlier. After a decade of growth, the global phone market is slowing as consumers wait for the next level of innovation such as bendable-screen phones and devices for fifth-generation wireless networks.

“Chips remain the goose that lays golden eggs for Samsung, but golden days may be over for its smartphones,” said Claire Kim, an analyst at Seoul’s Daishin Securities.

Samsung’s consumer electronics unit, which includes TVs and appliances, had profit of 510bn won.

Samsung said earlier this year that one of its biggest obstacles for business would be global protectionism, warning its employees to brace for potential implications.

The company at the same time is expanding its ability to produce memory chips and smartphones. Samsung last year announced 20tn won of new investments to increase chip output in South Korea and this year completed building the world’s largest smartphone factory in India.

Vice chairman Jay Y Lee, who has led the company since his father Lee Kun-hee fell ill in 2014, oversaw the opening of the factory, which South Korean President Moon Jae-in and Indian Prime Minister Narendra Modi also attended. Lee was released from prison in February on a suspended sentence for a bribery conviction in connection with a national influence-peddling scandal that led to the ousting of Mr Moon’s predecessor Park Geun-hye.

Under Mr Moon, who has pledged to get tough on chaebol - South Korea's family-run conglomerates - Lee faces a set of regulatory issues, including dissolving a complex web of cross-holdings that has helped his family stay in control of Samsung Electronics and its array of affiliates.

INDIA'S TOP INFLUENCERS

Bhuvan Bam
Instagram followers: 16.1 million
Bhuvan Bam is a 29-year-old comedian and actor from Delhi, who started out with YouTube channel, “BB Ki Vines” in 2015, which propelled the social media star into the limelight and made him sought-after among brands.
Kusha Kapila
Instagram followers: 3.1 million
Kusha Kapila is a fashion editor and actress, who has collaborated with brands including Google. She focuses on sharing light-hearted content and insights into her life as a rising celebrity.
Diipa Khosla
Instagram followers: 1.8 million
Diipa Khosla started out as a social media manager before branching out to become one of India's biggest fashion influencers, with collaborations including MAC Cosmetics.
Komal Pandey
Instagram followers: 1.8 million
Komal Pandey is a fashion influencer who has partnered with more than 100 brands, including Olay and smartphone brand Vivo India.
Nikhil Sharma
Instagram followers: 1.4 million
Nikhil Sharma from Mumbai began his online career through vlogs about his motorcycle trips. He has become a lifestyle influencer and has created his own clothing line.
Source: Hireinfluence, various

The five pillars of Islam

1. Fasting

2. Prayer

3. Hajj

4. Shahada

5. Zakat

EMILY IN PARIS: SEASON 3

Created by: Darren Star

Starring: Lily Collins, Philippine Leroy-Beaulieu, Ashley Park

Rating: 2.75/5

Avatar: The Way of Water

Director: James Cameron

Stars: Sam Worthington, Zoe Saldana, Sigourney Weaver

Rating: 3.5/5

SPECS

Engine: Two-litre four-cylinder turbo
Power: 235hp
Torque: 350Nm
Transmission: Nine-speed automatic
Price: From Dh167,500 ($45,000)
On sale: Now

21 Lessons for the 21st Century

Yuval Noah Harari, Jonathan Cape
 

CREW

Director: Rajesh A Krishnan

Starring: Tabu, Kareena Kapoor Khan, Kriti Sanon

Rating: 3.5/5

Blue Beetle

Director: Angel Manuel Soto
Stars: Xolo Mariduena, Adriana Barraza, Damian Alcazar, Raoul Max Trujillo, Susan Sarandon, George Lopez
Rating: 4/5 

Sarfira

Director: Sudha Kongara Prasad

Starring: Akshay Kumar, Radhika Madan, Paresh Rawal

Rating: 2/5

The specs

Engine: 3.8-litre, twin-turbo V8

Transmission: eight-speed automatic

Power: 582bhp

Torque: 730Nm

Price: Dh649,000

On sale: now 

Confirmed bouts (more to be added)

Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
Mackenzie Dern v Loopy Godinez

Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.

Company profile

Date started: December 24, 2018

Founders: Omer Gurel, chief executive and co-founder and Edebali Sener, co-founder and chief technology officer

Based: Dubai Media City

Number of employees: 42 (34 in Dubai and a tech team of eight in Ankara, Turkey)

Sector: ConsumerTech and FinTech

Cashflow: Almost $1 million a year

Funding: Series A funding of $2.5m with Series B plans for May 2020

UAE athletes heading to Paris 2024

Equestrian

Abdullah Humaid Al Muhairi, Abdullah Al Marri, Omar Al Marzooqi, Salem Al Suwaidi, and Ali Al Karbi (four to be selected).

Judo
Men: Narmandakh Bayanmunkh (66kg), Nugzari Tatalashvili (81kg), Aram Grigorian (90kg), Dzhafar Kostoev (100kg), Magomedomar Magomedomarov (+100kg); women's Khorloodoi Bishrelt (52kg).

Cycling
Safia Al Sayegh (women's road race).

Swimming

Men: Yousef Rashid Al Matroushi (100m freestyle); women: Maha Abdullah Al Shehi (200m freestyle).

Athletics

Maryam Mohammed Al Farsi (women's 100 metres).

RoboCop: Rogue City

Developer: Teyon
Publisher: Nacon
Console: PlayStation 5, Xbox Series X/S and PC
Rating: 3/5

The specs: 2019 Mercedes-Benz C200 Coupe


Price, base: Dh201,153
Engine: 2.0-litre turbocharged four-cylinder
Transmission: Nine-speed automatic
Power: 204hp @ 5,800rpm
Torque: 300Nm @ 1,600rpm
Fuel economy, combined: 6.7L / 100km

Company Profile

Name: Direct Debit System
Started: Sept 2017
Based: UAE with a subsidiary in the UK
Industry: FinTech
Funding: Undisclosed
Investors: Elaine Jones
Number of employees: 8

The specs: 2018 Mercedes-Benz S 450

Price, base / as tested Dh525,000 / Dh559,000

Engine: 3.0L V6 biturbo

Transmission: Nine-speed automatic

Power: 369hp at 5,500rpm

Torque: 500Nm at 1,800rpm

Fuel economy, combined: 8.0L / 100km

Results

United States beat UAE by three wickets

United States beat Scotland by 35 runs

UAE v Scotland – no result

United States beat UAE by 98 runs

Scotland beat United States by four wickets

Fixtures

Sunday, 10am, ICC Academy, Dubai - UAE v Scotland

Admission is free

DUBAI BLING: EPISODE 1

Creator: Netflix

Stars: Kris Fade, Ebraheem Al Samadi, Zeina Khoury

Rating: 2/5

UAE currency: the story behind the money in your pockets
ROUTE TO TITLE

Round 1: Beat Leolia Jeanjean 6-1, 6-2
Round 2: Beat Naomi Osaka 7-6, 1-6, 7-5
Round 3: Beat Marie Bouzkova 6-4, 6-2
Round 4: Beat Anastasia Potapova 6-0, 6-0
Quarter-final: Beat Marketa Vondrousova 6-0, 6-2
Semi-final: Beat Coco Gauff 6-2, 6-4
Final: Beat Jasmine Paolini 6-2, 6-2

COMPANY PROFILE

Name: Haltia.ai
Started: 2023
Co-founders: Arto Bendiken and Talal Thabet
Based: Dubai, UAE
Industry: AI
Number of employees: 41
Funding: About $1.7 million
Investors: Self, family and friends

Three ways to limit your social media use

Clinical psychologist, Dr Saliha Afridi at The Lighthouse Arabia suggests three easy things you can do every day to cut back on the time you spend online.

1. Put the social media app in a folder on the second or third screen of your phone so it has to remain a conscious decision to open, rather than something your fingers gravitate towards without consideration.

2. Schedule a time to use social media instead of consistently throughout the day. I recommend setting aside certain times of the day or week when you upload pictures or share information. 

3. Take a mental snapshot rather than a photo on your phone. Instead of sharing it with your social world, try to absorb the moment, connect with your feeling, experience the moment with all five of your senses. You will have a memory of that moment more vividly and for far longer than if you take a picture of it.


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