Back in June, South Korean electronics giant Samsung received a big hit when it lost $12 billion in terms of market value after the stock price of the company plunged by 6 percent as the sales of the flagship device of the company, Galaxy S IV, were lower than expected. Now on Friday, July 5th Samsung has suffered has another big loss, when its share price slide down by 3.8 percent during a single trading day according to Fortunes. The analysts believe that this big slide in the stock price took place due to the poor earnings forecast for Samsung.
Prior to the release of the Samsung’s press report, several analysts were hoping that the Korean company would post good earnings, but Neil Mawston of Strategy Analytics was not too hopeful. He said in an email that , “Apple is suffering from iPhone fatigue, while Samsung is suffering from Galaxy fatigue”. Even renowned publications such as New York Times, Wall Street Journal and Reuters indicated that both Samsung and Apple are travelling on the same vehicle. But Philip Elmer of Fortune strong suggested that ‘Samsung is in a mess of its own making’.
“Astonishingly, for a manufacturing giant as diversified as Samsung, it may have become even more dependent on smartphone sales than Apple. Mobile phones accounted for 74% of Samsung’s operating profit last quarter. In the same quarter, the iPhone represented 52% of Apple’s revenue and 65% of its gross profit.
Samsung spent a fortune driving those smartphone sales. It topped Ad Age’s list of the fastest growing U.S. ad spenders last month, and its worldwide ad budget last year was $4.3 billion — four times Apple’s.
The Galaxy S4, which the company released in March to such fanfare, was pitched as a showcase of Samsung innovation and its best shot at overtaking the iPhone 5. But sales of the Galaxy S4 couldn’t match the iPhone 5′s and have tailed off far more rapidly.”
Nevertheless, in order to have a good idea about the saturation of the high-end smartphone, all of us have to wait for the launch of Apple’s next gen of smartphones, which are likely to see the first light in a few months time. Until then it will be little unfair to make a prediction regarding the future of the high-end smartphones market that has seen numerous new high-level handsets during this year.
Source: iPhoneinCanada
Photo: X.Dawn
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