Samsung financials

The Galaxy Alpha – first announced in August – may turn out to be a short-lived model: rumors originating in Korea claim that the company plans to discontinue the model in favor of the Galaxy A5 as soon as current inventory is exhausted.

It was reported last month that Samsung planned to sell 30% fewer smartphones next year, as part of cost-cutting measures in response to declining profits … 
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Samsung’s troubles are far from over, says credit rating Fitch, predicting that the company’s share of the smartphone market will fall from 31 percent last year to 25 percent next year, reports the WSJ.

Nitin Soni, a Singapore-based director of corporate ratings at Fitch, warned that Samsung had lost its edge with consumers as Chinese companies like Xiaomi, Lenovo and Huawei make cheaper and cheaper products that meet most consumers’ needs.

He added that innovations like wearable devices and curved screens – two of Samsung’s recent tricks – are “unlikely to change the trend” …

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Korean site ET News reports that Samsung has cut its smartphone sales target for 2014 from 360M handsets to 330M. The company’s original goal would have represented 25 percent year-on-year growth, now reduced to just 14 percent.

The company is blaming saturation at the top end of the market, with many existing owners of flagship handsets having reduced their upgrade cycle from annual to bi-annual.

Samsung as a whole isn’t hurting – it recently announced record revenues and profits – but the bulk of those earnings came from lower-end handsets and its chip manufacturing business. The ET News piece says that Samsung also plans to move into a whole bunch of new areas, including cloud computing and hi-tech materials … 
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Photo: ibtimes.com

Samsung has beaten its earlier forecasts for both revenue and profit in Q3, reporting new records for both at $9.56B profit on revenues of $55.59B.

Samsung had earlier reported that it had sold more than 40 million Galaxy S4 handsets in the first six months, but advised today that most of its mobile growth was in lower-end models, while high-end growth is slowing … 
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Samsung is predicting a record $9.4B profit for Q3 in its latest earnings guidance, on estimated revenues of $53.9B. While both figures are estimates rather than confirmed results, Samsung’s earnings guidance is usually pretty much spot-on. If confirmed, this will build on the company’s record numbers in Q2.

HTC, in contrast, reported its first ever loss, as it warned back in July. Its revenue of $1.6B was lower than even its lower-end forecast, and it lost $101M – the company’s first ever loss in its 16-year history.

Bloomberg attributes the wildly differing performances to sales of mid-market handsets in growth markets like India and China.

While HTC has focused a revival on its flagship One handset and $12 million marketing deal with actor Robert Downey Jr., Samsung has expanded its range of mid-priced smartphones such as the Galaxy Golden and S4 Mini to capture sales in China and India … 
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