Samsung warns of Q2 profit slump as LCD business dives

Samsung has warned investors to expect a dive in Q2 2011 performance, with the revelation that – despite strong sales of smartphones, like the 3m-selling Galaxy S II – a slump in the LCD business would see profits drop year-on-year by as much as 1.51 trillion won ($1.42bn). The company has promised to reveal full details on July 29 when it releases a full earnings report, but analysts are already pointing to the similarities between the dire Q1 2011 performance and this latest quarter.

Samsung is likely to attempt to make smartphones its focus, with the company seeing significant sales success in recent months. Compared to 3.2m in 2010, Samsung sold around 19m handsets in the past quarter, and currently occupies the number two spot behind Nokia in the world cellphone rankings.

That popularity has in part been overshadowed by ongoing legal action between Samsung and Apple, with the Korean company branded a "copycat" for the design of its Galaxy series of tablets and phones. In return, Samsung has alleged that Apple has infringed its patents in return. Attempts by both firms to have an injunction on their rivals' product ranges have so far failed, though Apple won early access to certain new models in Samsung's line-up.

The legal spat is all the more unusual when you consider that Apple is reportedly Samsung's second-largest customer for its electronics and other components. Samsung holds the top-spot in the manufacture of flash memory and LCD panels, though Apple is believed to be shopping around for alternative suppliers.

[via Physorg]