Samsung Q3 estimates beat forecast, but still disappoints

Summary:Samsung is slightly more optimistic than financial analysts about its third quarter earnings estimates, but profits are still down.

Samsung has been bleeding money over the past year, but the revision of its third quarter earnings estimates suggests that it found a tiny band-aid.

The Seoul-based corporation announced its pre-earnings guidance figures on Friday, and here's where it stands now. Instead of the original forecast of 3.4 trillion won ($2.9 billion), Samsung is expecting third quarter operating profits of 4.20 trillion won ($3.6 billion). However, that is still roughly 14 percent less than what Samsung was producing one year ago.

Third quarter sales are predicted to be around 41.0 trillion won ($34.7 billion). Samsung is expected to reveal Q3 earnings later this month.

Nevertheless, despite disappointing flat screen sales, falling memory chip prices, and even a number of lawsuits worldwide concerning the Galaxy S series, some analysts are accrediting the improved estimates to its smartphone division. Reuters reports:

"I think Samsung's telecom business was a big positive surprise, and other businesses fared better than expected," said Ahn Seong-ho, an analyst at Hanwha Securities.

"I previously thought Apple's new iPhone would slow Samsung's handset earnings momentum, but there was no iPhone 5, and the iPhone 4S will not be a burden on Samsung in the fourth quarter."

Samsung and other mobile manufacturers might not want to wave off the iPhone 4S so quickly, despite mixed reviews. We'll know more after the iOS device starts shipping next week, but remember this lesson: Sony Ericsson's CEO recently said that his company should have taken the original iPhone more seriously when it was released in 2007. Any chance that analysts and executives will be saying the same thing about this device a few years down the line?

Related:

Topics: Samsung, iPhone, Smartphones

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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