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Samsung Profits Falls 60%: Report

Sales of premium TVs such as QLED TVs and ultra-large size models contributed to the (YOY) earnings growth in the Consumer Electronics (CE) division

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samsung foldable phone
FILE - The Samsung Galaxy Fold phone is shown on a screen at Samsung Electronics Co. Ltd.’s Unpacked event in San Francisco, Feb. 20, 2019. Samsung says it will look into some reports of flickering or cracking screens. VOA

Hit by weak demand in the memory chips and displays, Samsung Electronics on Tuesday reported a massive 60 per cent drop in operating profit (year-on-year) in the first quarter of 2019.

The company, however, said the newly-launched Galaxy S10 smartphone is generating solid sales.

It shipped 78 million smartphones and five million tablets in the quarter.

Samsung posted operating profit of 6.2 trillion won (nearly $5.4 billion) – from 15.64 trillion won (roughly $13.4 billion) last year — and quarterly revenue of 52.4 trillion won which fell 13.5 per cent.

“The Semiconductor business saw a drop in memory chip prices as inventory adjustments continued at data centre companies, while demand for high-density memory for mobile phones increased thanks to new flagship smartphones,” said the South Korean giant.

Samsung said it expects limited improvement in the memory chip market in the second quarter, as demand will likely begin to improve for major applications such as mobile products but price declines will likely continue.

The display panel business reported a quarterly loss due to decreased demand for flexible displays and increasing market supplies for large displays.

samsung, tablet folded phone
The new Samsung S10 phones are displayed Feb. 20, 2019, in San Francisco. Samsung is hailing the 10th anniversary of its first smartphone with three new models that it hopes reverses a sales slump in an industry recycling the same ideas. VOA

In the IT & Mobile Communications (IM) division, despite solid sales of the Galaxy S10, profitability in the mobile business declined (YoY) as competition intensified in the low- to mid-range segment.

Samsung said it will strengthen its product line-up through innovations such as Galaxy S10 5G and Galaxy A80 and continued reorganization of its product offerings.

For the second half, despite intensified market competition, Samsung expects smartphone sales to increase led by new models in all segments from the Galaxy A series to the Galaxy Note amid strong seasonality.

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“In the premium segment, the company will strengthen its leadership through the new Galaxy Note as well as its innovative products such as 5G and foldable smartphones,” Samsung said.

It means that Samsung’s much-awaited foldable device “Galaxy Fold” that met with cracking screen controversy may arrive in the later part of the year.

Sales of premium TVs such as QLED TVs and ultra-large size models contributed to the (YOY) earnings growth in the Consumer Electronics (CE) division, the company added. (IANS)

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5G Samsung Smartphones Capture 5% of Global Premium Market

Currently, all the 5G phones available fall within the premium segment, but this will also change in 2020

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The adoption of 5G will play a key role in the growth of the premium segment as well as the overall global smartphone market. Pixabay

5G smartphones captured 5 per cent of the global premium market in the third quarter (Q3) of 2019 led by Samsung with 74 per cent share followed by LG with 11 per cent and Vivo with 5 per cent share, a new report by Counterpoint Research has said.

According to Counterpoint Research “Market Pulse” service, the global premium market sell-through, however, declined 7 per cent YoY.

The Samsung Galaxy S10 5G was the top-selling model which captured over one-third of the total sales of all 5G devices.

“All major OEMs in the premium segment now have 5G-capable devices, except Apple. Still, Apple alone captured over half of the premium market in Q3 2019. Apple grew 1 per cent YoY increasing its market share from 48 per cent a year back to 52 per cent during the quarter. iPhone XR was the top-selling model globally in the premium segment,” Varun Mishra, Research Analyst, Counterpoint Research, said in a statement.

Huawei remained in the top three OEMs in the premium segment driven by the popularity of its P30 series, especially in China, despite the US ban.

China contributed to over 80 per cent of Huawei’s sell-through in the premium segment as compared to 73 per cent in the year ago quarter.

“The trend is likely to continue. It will be difficult for the newly launched Mate 30 series to create any progress outside China because it lacks Google Mobile Services (GMS). GMS is an important enabler for Huawei to continue its success outside China,” Mishra noted.

OnePlus recaptured its position among the top five OEMs in the segment and also led the India premium segment, which reached a record high shipment level during Q3.

South Korean smartphone maker LG also captured a spot in the top five, driven by the V50 ThinQ 5G. The firm grew 20 per cent YoY in the premium segment. This is in contrast with its overall smartphone shipments, which declined over 30 per cent YoY during Q3.

5G
5G smartphones captured 5 per cent of the global premium market in the third quarter (Q3) of 2019 led by Samsung with 74 per cent share followed by LG with 11 per cent and Vivo with 5 per cent share. Wikimedia Commons

The adoption of 5G will play a key role in the growth of the premium segment as well as the overall global smartphone market.

Apple will launch its 5G devices in 2020 driving upgrades among Apple users and potentially pulling in some previous Android users.

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“Currently, all the 5G phones available fall within the premium segment, but this will also change in 2020. Major Chinese OEMs will launch 5G-capable devices in the sub-$ 400 price band. China will drive the 5G segment followed by other key markets like the US and Korea,” Mishra added. (IANS)