“The next big thing is here, as Samsung Electronics likes to say in its ads,” Brian X. Chen reports for The New York Times. “But fewer people appear to be buying it.”
“Samsung, which is based in South Korea, on Tuesday published a financial earnings preview that forecast a profit of about 7.2 trillion won, or $7.1 billion, for the three months that ended in June,” Chen reports. “While that is still a substantial chunk of money, the overall profit represents a decline of 24 percent from the same period a year ago. The profit forecast also missed analysts’ expectations of about 8 trillion won.”
“In order to bolster sales of smartphones over the quarter, Samsung said, it had to increase spending on marketing promotions, which also ate into its profit. For example, in one promotion offered by Verizon Wireless, consumers could buy a Galaxy S5 smartphone and get another phone free,” Chen reports. “Samsung, which offers a range of phones at various prices, is feeling pressure from all sides of the market. In the high end, it faces stiff competition from Apple, whose iPhone sales have recently accelerated thanks to a new partnership with China Mobile, the largest phone carrier in the world.”
MacDailyNews Take: Samsung doesn’t make a “high-end” smartphone. All of Samsung’s phones are cheap ploys aimed at fooling the gullible into thinking they have a real iPhone.
Chen reports, “And in the low end and midtier phone markets, Samsung is facing intense competition from emerging Asian phone makers like Lenovo, ZTE, Xiaomi and Huawei.”
Read more in the full article here.
MacDailyNews Take: Bu, bu, but… market share! Here’s a nice primer on why market share for market share’s sake is a losing “strategy”:
• Samsung profit misses estimates as cheap phones struggle – July 8, 2014
• Apple smashes Street with revenue of $45.65 billion in Q214 – April 23, 2014