Samsung expects a poor quarterly profit, smartphones wearing it down

Samsung is expecting its quarterly profits to punch in at 4.1-trillion won (US$3.8-billion) — that’s about 60% down from last year’s 10.2-trillion won forecast.

The tech company seemingly has its fingers in all pies on the market — from televisions to smartphones, smartwatches and processors. The latter seems to be where it’s placing its bets going forward, nudging away from its poor performing mobile sector.

A report by Counterpoint Research in July highlighted the company’s struggle to keep up with the likes of Apple’s iPhone 5s. Even though Apple’s then flagship smartphone has been on the market for about seven months, it managed to beat Samsung’s competitor, the S5 in sales. Apple shipped 7 million iPhone 5s devices while Samsung shipped 5 million brand new Galaxy S5 devices.

It is not all that doom and gloom however.

Samsung is expected to lead in the chipset race rather than smartphones. An analyst tells the Wall Street Journal that he expects the tech giant’s annual chip profits to rise 34% to 11.5-trillion won next year, compared to an estimated 8.6-trillion won this year.

Mobile operating profit on the other hand, is expected to fall to 9.7-trillion won in 2015 from an estimated 14.8 trillion won this year. That’s a huge dip.

To secure its commitment, Samsung announced earlier this week that it will be investing US$14.7-Billion in a new chip manufacturing plant in South Korea. It’s been reported that Samsung will also be responsible for Apple’s next-gen iPhones’ processors. This comes at the back of partnerships with major chip manufacturers Qualcomm and AMD.

The South Korean tech giant will publish its results later this month.