Although Samsung was able to sell 10 million units of its flagship device, the Galaxy S IV, within the first month of its release, it seems that the sales of the new smartphone are slowing down. As a result of that the Samsung Galaxy S IV has missed its sales target. According to the latest report from Reuters, this slide in sales of the Galaxy S IV has caused Samsung to lose $12 billion in terms of market value. It is because of this very reason the stock price of the South Korean company has also came down by 6 percent following the introduction of two low-end versions of the flagship smartphone, the Galaxy S IV Mini and Galaxy S IV Active.
The report also indicates that brokers have downgraded the value of Samsung’s stock due to concerns over its mobile business profit margins. According to the tech analysts this drop in the sales of the Galaxy S IV is the courtesy of the two newly announced variants of the flagship phone, which company has introduced in the past few weeks.
The price of Samsung’s shares has fallen down further after new reports indicated that soon Apple is going to start the trade-in program for its flagship smartphones. This trade-in program will make the upgrading to the new model easier than before.
Shinhan Investment Corp’s analyst, Kim Young-chan said that, “Sales of high-end handsets are lagging behind expectations, while low- to mid-end handsets are selling briskly worldwide.”
“As the portion of low- to mid-range handsets is expected to increase in Samsung’s overall mobile phone business, this has also sparked concerns about thinning margins and lower growth.”
“With Apple widely expected to announce an older iPhone trade-in program and also a new cheaper iPhone, overall growth prospects for (Samsung’s) smartphone business have dimmed,” said Kim Hyun-yong, an analyst at E*trade Securities.
Samsung’s shares closed at their four months low after they slide down by 6.2 percent, “wiping out $12 billion of value to bring its market cap to $188 billion,” according to iPhoneinCanada. Apart from this some also believe that another factor behind the slow sales of S IV could be that Samsung has sent out invites for its June 20th ‘Premier’ event in London, where the company is expected to launch new Galaxy and ATIV devices.
However, it will be interesting to see whether the sales of the 5-inch Galaxy S IV will rise once Samsung rolls out the new ATIV and Galaxy devices on June 20th.
Source: iPhoneinCanada
Photo: MobileUtil
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