Samsung Electronics has confirmed expectations for its first annual profit decline in three years as it lost market share in the smartphones business, Reuters reported.
The South Korean electronics giant on Thursday flagged operating profit of 5.2 trillion won (US$4.74 billion) for the fourth quarter of 2014, pointing to full-year earnings of about 25 trillion yen.
The indicated annual profit will be the lowest since 2011, the report noted. The company will unveil its annual results around the end of this month.
Samsung lost market share for three consecutive quarters up to July-September, and the trend likely continued in the fourth quarter thanks to competition from Apple Inc’s new iPhones and Chinese rivals such as Xiaomi Inc, the report said.
The mobile division’s contribution to Samsung’s profit has slipped from about 68 percent at its peak in 2013 to about 44 percent in the third quarter of 2014, as its high-end offerings lost out to Apple’s iPhones and buyers in emerging markets opted for cheaper devices from Chinese firms.
The division saw some improvement in fourth-quarter profit compared to the preceding three months, but overall smartphone shipments fell, a source was quoted as saying.
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