Samsung cuts prices for Galaxy S6, S6 Edge by 100 euros after disappointing financial results
Just four months after launching the new Galaxy S6 and S6 Edge, Samsung has begun to drop the price of its flagship handsets in an apparent effort to jumpstart slumping sales and push its troubled mobile division further into the black.
Consumers in The Netherlands are the first to benefit from Samsung's new strategy, with the 32-gigabyte S6 now going for just ?599 and the S6 Edge coming in at ?699 in the European nation. The changes were first noted by BetaNews.
Samsung announced plans to rework Galaxy pricing last week after posting disappointing financial results in its second fiscal quarter. Mobile division profits dipped by 38 percent year-over-year --?though they were up very slightly sequentially --?which contributed to an overall 8-percent profit decline for the conglomerate.
Some reports have suggested that Samsung underestimated demand for the curved-display S6 Edge and overestimate demand for the more standard S6, leading to a shortfall in supply of the former and a glut of unsold units of the latter. The company is thought to be in the process of reshuffling its supply chain to compensate, but was forced to turn to price cuts in the interim.
The price cuts come just days before Samsung is rumored to announce a larger S6 variant --?dubbed the S6 Edge+ --?to take on Apple's wildly successful iPhone 6 Plus. The launch, which could come as soon as August 12, is also likely to bring a revamped Note 5 phablet.
Consumers in The Netherlands are the first to benefit from Samsung's new strategy, with the 32-gigabyte S6 now going for just ?599 and the S6 Edge coming in at ?699 in the European nation. The changes were first noted by BetaNews.
Samsung announced plans to rework Galaxy pricing last week after posting disappointing financial results in its second fiscal quarter. Mobile division profits dipped by 38 percent year-over-year --?though they were up very slightly sequentially --?which contributed to an overall 8-percent profit decline for the conglomerate.
Some reports have suggested that Samsung underestimated demand for the curved-display S6 Edge and overestimate demand for the more standard S6, leading to a shortfall in supply of the former and a glut of unsold units of the latter. The company is thought to be in the process of reshuffling its supply chain to compensate, but was forced to turn to price cuts in the interim.
The price cuts come just days before Samsung is rumored to announce a larger S6 variant --?dubbed the S6 Edge+ --?to take on Apple's wildly successful iPhone 6 Plus. The launch, which could come as soon as August 12, is also likely to bring a revamped Note 5 phablet.
Comments
I have seen a few here, but everyone is still clamouring for the iPhone. My students want to buy my iPhone6 when the 6s comes out.
Yep, nothing like cutting the price and reducing the profits to help profits ... Oh wait a minute ... reminds me of that saying, 'when in a hole, stop digging.'
They have a lot of margin in their top end phones, it's the low end junk they sell that brings their overall margins down.
these firms struggle to make money from an OS which they get for free whilst a company relatively new to the mobile market, a company which created and continues to refine its mobile device OS, walks off with the majority of the profit in the sector.
Well of course we know that the sales were disappointing. That doesn't change the fact that new models launch in less than a month and existing stock needs to be cleared. Most companies run "sales" on existing models with significant inventory when new ones are imminent. If they were selling great there would almost certainly still be some price cuts on that soon-to-be-old stock. You know that, you're a smart guy.
Its weird though; the new "S" models you refer to aren't new models replacing existing models (exception: Note, not an S though). Supposed new S6 Edge + and Note 5, but the S6 and S6 Edge are only half way through their life cycle (based on prior schedules). No new S7 or S7 Edge models being launched.
And additioanly, what @LarryA just said above. If the sales mix was unexpectedly favoring the S6 Edge (not the new, supposed Edge +), why cut price on a product in demand. This has only been done in one country so far though, so maybe they're just trying to spur local demand and the S6 Edge price will remain the same elsewhere.
We'll just have to make our assumptions based on we see (as we all do anyway). I wont state anything as fact...
"Razr-thin" margins?
Nice post. BTW for those that didn't see news on these yet tho you obviously have:
http://www.androidcentral.com/possible-galaxy-note-5-and-s6-edge-press-renders-leak-ahead-announcement?utm_source=related&utm_medium=module&utm_campaign=next
Reuters, Times of India, BGR,re/code, Financial Express, Huffington Post etc etc, etc all said "Samsung expects Galaxy S6, Galaxy S6 Edge record shipments". Funny thing, they all said the exact same thing on the exact same day. Where are their retractions/corrections? Where is their "reporting".
Sheesh......
... and I already noted they were "getting their ass kicked" just as everyone here already knew. I guess making believe I hadn't works for your purposes tho.
I guess people just hear what they want to hear. So where is the evidence that the price reduction has nothing to do with the historical competitive market pricing, all to do with their recent below-expected earning? It seems fairly clear that the $100 price cut fits inline with their historical pricing strategy -- 20% to 25% after 4 months -- but hey whatever makes you happy. *yawn*
They're releasing the 6+, basically copying Apple's mid-cycle naming convention. Apple isn't releasing the iPhone 7 either AFAIK but the one coming in just weeks is still "new and improved".
... and I already noted they were "getting their ass kicked" just as everyone here already knew. I guess making believe I hadn't works for your purposes tho.
Apple doesn't release a new phone Mid-cycle. Apple doesn't generally drop prices of iphones until the Next generation iPhone launches. Apple doesn't change the External look of the iPhone every year and it's always been like this. The S series externally look the same but the internals are completely different. Samsung is getting their butt kicked! Their profits are down. They's getting beat by Apple on the high end and cheap China phones on the low end. You can sell a zillion phones, but if you're just breaking even, what's the point? You're spinning your wheels.
They're releasing the 6+, basically copying Apple's mid-cycle naming convention. Apple isn't releasing the iPhone 7 either AFAIK but the one coming in just weeks is still "new and improved".
... and I already noted they were "getting their ass kicked" just as everyone here already knew. I guess making believe I hadn't works for your purposes tho.
I think you are confused.
The 6+ they are releasing is NOT copying Apple's mid-cycle naming convention. It is copying the larger screened iPhone6 Plus, which was announced & released for sale at the exact same time as the iPhone6. Apple's mid-cycle naming convention uses an S to indicate it is a "mid-cycle" release (ex: iPhone3GS, 4S, 5S, etc). Expect Apple's mid-cycle naming convention to announce the iPhone6S & 6S Plus later on this year. A release that will happen almost exactly one year from announcement of the iPhone6 & 6 Plus.
Furthermore.. the iPhone7 (total redesign) isnt expected until fall of next year, which will be a full two full years after the iPhone 6 was introduced. These new Samsung phones are being released just 4 months after the Galaxy S6 & S6 Edge were released.