Samsung's profit squeezed by Galaxy S6 Edge shortage

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Credit: Florence Ion

Samsung Electronics expects to report lower than expected earnings for the second quarter after supply shortages kept down sales of its Galaxy S6 Edge smartphone.

Operating profit for the quarter will likely be around 6.9 trillion won ($6.1 billion), Samsung said, below the 7.2 trillion won analysts had been expecting. Sales are estimated at 48 trillion won, below the 53 trillion won analysts had forecast.

Samsung issued the preliminary earnings on Tuesday in Asia. It’s due to report its full results later this month.

The Galaxy S6 isn’t only Samsung’s flagship smartphone. It’s also its main hope for reigniting demand for its handsets, which has cooled in recent quarters.

The Edge variant of the phone has a distinctive display that curves around the right hand side of the device, and it’s that curved display that was in short supply last quarter, analysts have said. Samsung also underestimated demand for the S6 Edge, and produced too many regular, flat Galaxy S6 phones.

Samsung is pinning its hopes on the S6 at a time when it’s being squeezed by Apple at the high-end and by Xiaomi and other Chinese vendors at the low-end. Apple’s iPhone 6 and 6 Plus in particular have been big hits around the globe, taking away sales from Samsung.

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