Samsung Says 'Weak Demand' for its Older Phones is Hurting Profits

Samsung Samsung's marketing budget has always been vast, but in the last quarter it was far larger than even the manufacturer itself would have liked. The company admits that it's been forced to spend extra money on promotions for older and lower-end devices that have been filling up its warehouses due to "weak demand." This dip in trade, combined with the extra spend on publicity, is causing the company's recent, gradual profit decline to quicken: it now expects to earn around 24 percent less this quarter than it did a year ago, with underlying sales down by an estimated 8-11 percent. Samsung claims the main underlying causes are stiffer competition in Europe, especially in the low- and mid-range parts of the market (presumably from the likes of Motorola), as well as a tougher climate in China, where many buyers are choosing to hold out for 4G phones rather than picking up current 3G models.

Read the full story at Engadget.