Samsung outlook disappoints

Consumer electronics maker offers guidance on how it performed in the fourth-quarter. It will still see a profit, but not as high as previously expected.

Don Reisinger
CNET contributor Don Reisinger is a technology columnist who has covered everything from HDTVs to computers to Flowbee Haircut Systems. Besides his work with CNET, Don's work has been featured in a variety of other publications including PC World and a host of Ziff-Davis publications.
Don Reisinger

Samsung expects to post a profit from the fourth quarter, but its cash gains are on the downswing.

The company said Friday in Korea that it expects to show a 3 trillion won (about $2.67 billion) operating profit in its fourth-quarter financial report when it announces results in the coming weeks. That compares with a 3.4 trillion won operating profit in the same period the previous year and a 4.9 trillion won operating profit in the third quarter of 2010.

Samsung's estimated profit decline in the fourth quarter was due mainly to plunging TV prices, the company said. Earlier this week, market researcher DisplaySearch reported that television pricing in North America declined by 6 percent in 2010. In 2009, the North America television market saw TV pricing drop by 22 percent.

DisplaySearch also noted that the LCD TV market will see its "first ever revenue decline" in 2011 due to continuing price erosion.

That's especially a concern for Samsung. During the third quarter of 2010, the company shipped more televisions than any other vendor, securing 19.3 percent of all television shipments to the United States, according to a report from market researcher iSuppli. All told, Samsung shipped 1.8 million televisions during the period.

But it's not all bad news for Samsung. The company reported earlier this week that it has sold 10 million Galaxy S smartphones since their launch in June.