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Samsung Electronics expects better sales, lower profit

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Staff writer | Tuesday January 7, 2014 6:52AM ET
Samsung ElectronicsSamsung Electronics Co. Ltd. said it expects operating profit for the fourth quarter to decline six percent year-over year, but sees a five percent growth in sales.


According to a regulatory filing, Samsung estimates operating profit for the fourth quarter to be 8.30 trillion won or about $7.8 billion, significantly below analysts' expectations of 9.75 trillion won. The forecast is 6.1 percent lower than the company's year-ago quarter operating profit of 8.84 trillion won, and represents an 18.3 percent drop from third-quarter operating profit of 10.16 trillion won.

Samsung also projected quarterly sales to increase 5.2 percent to 59 trillion won from last year's sales of 56.06 trillion won, but below Street estimates of 61 trillion won. However, total sales is seen to edge down 0.1 percent from the previous quarter's sales of 59.08 trillion won.

Operating margins for Samsung's flagship mobile devices business, which generates the bulk of its profits, have been waning recently due to the company's smaller presence in the high-end market as well as higher marketing expenses and intense competition.ion shares.

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