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Samsung hopes to restore confidence with its concerned investors at strategy meeting

Source: Samsung

Last updated

Samsung is organizing a "strategic conference" with 400 investors and analysts, in order to "fight a gnawing suspicion that its heyday may have come and gone."


Source: Reuters

According to a report by Reuters, Samsung's prior "series of record profits" from smartphones is now being seen by analysts as linked to a segment that "may have passed its peak this year as the market saturates and competition from cheaper phones intensifies."

Samsung began warning its investors in January that easy profits from smartphones were increasingly going to be offset by competitive pressures and satiating demand. However, the media hype machine continued to portray Samsung as the new, innovative powerhouse that would replace Apple.

Samsung's shares over the most recent quarter dropped 13 percent, largely in response to weaker than expected sales of its flagship Galaxy S4 smartphone, which was launched with great fanfare but delivered very little to incite sales excitement among consumers.

The company is largely dependent upon smartphone sales, which account for two thirds of Samsung Electronics' total profits. Reuters noted that other businesses, including solar cells and medical equipment, have failed to yield tangible results since they were first unveiled in 2010.

Apple vs Samsung

Apple's shares are also down significantly from their peak one year ago. However, Apple hasn't launched any major new products since its top to bottom refresh of its product line completed during the year-ago holiday season.

Apple has fought against incessant criticism and badgering predictions of doom throughout the year, despite maintaining a lock on the majority of industry profits across the PC, tablet, smartphone and mobile apps segments.

And while Apple hasn't released new smartphones and tablets, its existing iPhone 5 and iPad mini continue to lead every other competing model in both sales volumes and in profits.

In stark contrast, Samsung has spent the year floating on enthusiastic optimism while it launched new flagship models at regular intervals. In the previous quarter, it debuted both the S4 and the Galaxy Note 8, an iPad mini competitor.

While the S4 phone failed to meet lofty expectations, the Note 8 tablet failed to even maintain the company's tablet shipment volumes. Tablet shipment estimates by IDC and Strategy Analytics both agreed that Samsung's tablet shipments actually declined sequentially by millions of units in the quarter, despite the new model launch.

Data from Strategy Analytics further indicates that outside of subsidized phones and "phablets," Samsung's non-subsidized sales of tablets and the rest of its notebook, netbook, ChromeBook and other PC businesses account for very little, reportedly just $440 million in profits, or a tenth of what Apple earns from its comparable, non-iPhone products.

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Samsung has also released a series of products intended to duplicate Apple's iPod touch and Apple TV, but hasn't been able to strong demand for either category. Its own efforts to develop original products, including the Galaxy Camera, have also been insignificant, despite Samsung's efforts to boost sales by giving away free tablets from its inventory as an incentive.



45 Comments

einsteinbqat 156 comments · 14 Years

And what are Samsung's innovations lately?

johnl 9 comments · 11 Years

It hasn't come and gone%u2026 they just don't have any product to copy these days. They need Apple to out some new stuff%u2026 or Sony%u2026 or anyone for that matter. They can't continue to release larger and more plastic phones and think they are fooling people into considering that "innovation" Their smartwatch release sure shows they suck at innovating on their own%u2026.

don108 79 comments · 14 Years

Samsung's investors should be worried. Apple hasn't produced anything for Samsung to copy, so now they're copying things based on rumors of what Apple will produce (smart watch). Well, Apple will be coming out with some new items in a few days. Samesong: get those photocopiers humming!

ajbdtc826 190 comments · 14 Years

After seeing that hideous watch, I can see what the concern is.