Samsung Expects Record Profit, But …

by Alyssa Oursler | October 5, 2012 11:29 am

Samsung is expecting a record profit of $25 billion this year after posting a record quarterly profit of $7.3 billion in Q3 — nearly double year-over-year.

Analysts, though, expect the company’s streak of four consecutive record quarters to come to a screeching halt next quarter — and then to decline until the second quarter of next year.

Some headwinds include higher performance payouts for employees, around $1 billion in legal damages to rival (and customer) Apple (NASDAQ:AAPL[1]) and a crowded smartphone market.

The company is also increasing its marketing in the face of its competitor’s new must-have iPhone 5, despite having already spent billions so far this year.

Still, the company has enjoyed solid sales of high-end TVs and Galaxy smartphones, allowing it to boom even as Apple reduced order for chips and screens.

In Q3,  the company’s mobile division more-than-doubled to around two thirds of total profit, while smartphone shipments topped 58 million.

Next year, Samsung is planning to scale back its chip investment because of such falling demand.

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