Samsung prepares lower-end phones as Q1 operating profit falls
Samsung is preparing more lower-end phones for emerging markets
IDG News Service - Samsung Electronics posted a dip in its operating profit for the first quarter, falling by 3.3% year-over-year as the company faces growing competition in the smartphone market.
During the period, the company's operating profit reached $8.2 billion. It marked the second consecutive quarter the operating profit has fallen.
The South Korean electronics maker has been posting weaker earnings, after previously reporting profits in the double digits on surging smartphone sales. While the company's handsets still remain popular across the world, consumers are increasingly buying less pricier smartphones, especially in markets such as China.
On Tuesday, however, Samsung said it continues to "solid sales" for its higher-end phones the Galaxy S4 and the Note 3. The company also expects to see a boost in it earnings next quarter, with the launch this month of its newest flagship phone, the Galaxy S5.
Samsung projects that sales of the S5 will surpass the S4, which sold over 10 million units in the first month after its launch last year. The company's mobile devices business makes up over half of its revenue.
For emerging markets, the company is developing more lower-end phones that will come with larger screens, and slots to carry two SIM cards, company executives said in an earnings call. Samsung also wants to incorporate the user interface features found its flagship phones into its existing mid-range handsets.
"There's continued growth in the $100 dollar below market in smartphones," said Hyunjoon Kim, senior vice president for Samsung's mobile communication business. "We will be adding new products to that price segment as well."
In this year's second quarter, the company's earnings will see an additional boost from better sales of its display panels and home appliances, Samsung said. Orders for its displays in high-end smartphones are increasing, and more TVs will be bought during the run-up to the World Cup in Brazil, the company added.
- Securing Mobile App Data - Comparing Containers and App Wrappers Analysts agree that Mobile Device Management (MDM) is not enough when it comes to securing app data. Although it remains a critical component...
- 3G/4G Digital Signage Guide Today, the widespread availability of 3G and 4G cellular or wireless broadband networks enables digital signage to be deployed virtually anywhere.
- Enterprises in Motion: In-Vehicle Networks In a world where traditional tethers to the central office have all but vanished, enterprises that operate vehicle fleets require constant and dependable...
- Uninterrupted Internet: Maximizing Revenue and Minimizing Business Risk with 3G/4G Failover Whether your businesses are connected to the Internet via T1/T3, or Cable, incorporating a mobile broadband backup solution adds uptime whenever there is...
- Don't Believe the Hype: Not All Containers are Created Equal Hear executives discuss the 3 C's of Secure Mobility-content, credentials, and configurations-and learn the inherent security risks to your organization of using MDM...
- Navigating the New Wireless Landscape Thriving in the new wireless landscape View Now>> All Mobile/Wireless White Papers | Webcasts