But... but... but Android has much greater market share so it's really Apple and the iPhone that's doomed. Wall Street is fairly certain that Apple will be lucky to move a few million iPhones in all of 2014 on China Mobile because almost no consumer in China can afford an iPhone. Besides, the Chinese consumer only wants smartphones with a minimum of a 4.7" display and Apple doesn't make an iPhone that size.
/s
I can't wait to see what miracle Samsung is going to create with the Galaxy S5 in order to achieve high sales. The S4 was probably the most feature-laden Android smartphone available last year and if that didn't sell as well as expected it was because consumers didn't need that complex a smartphone and many consumers actually settled for the giveaway Galaxy SIII which was more than satisfactory. Once Apple starts selling a large display iPhone that will be one less advantage the Galaxy S will have over the iPhone.
Apple is outselling Samsung's large screen phones, the fall in profit indicates people who choose Samsung phones are buying their cheaper, smaller screened models.
This can't be blamed on competition because revenue is actually up slightly from Q3 2013 and up significantly from Q4 2012. Revenues are perfectly correlated with sales, so sales couldn't have declined unless per-device margins increased.
This drop in profits is due to increased expenses.
Not sure what figures ur referencing. Samsung's Mobile department dropped 9% in revenue and 18% in profit year over year. If ur a big enough fan of samsung that you're referencing a division larger than mobile, you should probably start reading refrigerator insider and microwave insider as well.
Samsung's revenue includes Consumer Electronics department (domestic electronics, like TV), which contributed to that "slightly up revenue". Samsung's Mobile department dropped 9% in revenue and 18% in profit year over year.
That's QoQ, not YoY. Samsung's IM quarterly sales is up by about +9% and profit pretty much the same YoY. Their IM annual sales/profit is up by about +30% YoY.
IM sales (9% gain)
4Q 2012 30.71
4Q 2013 33.89
IM profit (0% no change)
4Q 2012 5.47
4Q 2013 5.47
Now, according to Bloomberg and theVerge, (1) worker bonus (700B KW) and (2) higher Korean Won (800B KW) are mainly to blame for higher expenses during the 4th quarter. That explains 1500B KW of the 1850B KW QoQ decline (but yes Mobile's sales is still down by 9% QoQ).
It probably has a lot do to with the fact that the S5 is coming out soon -- Apple sales often peaks in 4Q (or 1Q for Apple); then steadily declines until the next iPhone release. Samsung's profit is likely to surpass Apple's in 2Q and 3Q this year.
I think it's pointless to sponsor every single major world sports events (eg, the summer / winter Olympics), or buy celebrity endorsement -- though not all of them are bad (eg, Jay-Z bad, LeBron James cool). Now, I don't think all of Samsung's 2013 marketing budget $13B went into advertising and celebrity endorsements, I heard a large chunk of their marketing expenses pay for rebates, etc, etc.. Anybody know the exact break down?
Yes, a large chunk went into the government bribe slush fund and the rest was used to pay astroturfing South Korean high school student.
They are still up YoY, QoQ is meaningless. That being said they are getting hit by the Nexus phones and tablets as more and more consumers wants pure Android, easy upgrades and no bloatware.
Must be fun to compete in a market where you're OS maker is dumping hardware at cost, enjoy...
They are still up YoY, QoQ is meaningless. That being said they are getting hit by the Nexus phones and tablets as more and more consumers wants pure Android, easy upgrades and no bloatware.
Must be fun to compete in a market where you're OS maker is dumping hardware at cost, enjoy...
Indeed I bought a Nexus over an S4 because of how filled with crap it was. It's a great market for the consumer at the moment. Sony, Asus, LG et al are all viable competitors and are also trying to explore new markets
So Samsung's lunch is being eat from the bottom, like they could not see that coming. This is the problem in the market place, when you are trying to ship the most cheap stuff there is always someone who can go even lower than you. In Apple case when you only interested in the premium market place its hard to a competitor to come in and eat your lunch.
In the case of Samsung they are trying to compete in both markets and getting beat from above and below. they being squeezed on both sides. They can not make enough on the high end to allow them to give away the cheap stuff and fend off their no overhead competitors.
Every manufacturer is going to hit limits with the market. Markets grow more quickly when they are new. Apple went up first and slowed first because they were first. Android became usable 2 years after Apple introduced the iPhone and so it took off later and has slowed later. The market is still growing but it's going to slow down the more that people already own devices. What happens next is the manufacturers looking for marketshare and to maintain growth cut their margins and the net profit drops but unit volume goes up. This allows them to gain traction in developing countries.
Apple didn't do this with the Mac to the extent PC manufacturers did, they stuck to high margins and prices. While that has resulted in 5% global Mac ownership, they maintain their profit and are still competitive in volume with individual counterparts. The iOS devices haven't suffered the same lower sales volume. The ownership is roughly 700 million iOS vs 1 billion Android so assuming those two make up 95% of all modern smart devices, they'd have iOS with 39% marketshare and Android 56% and at least 1/5th of the Android ones are on 2.x. This is partly because although Apple maintains margins and prices, the price points are low enough that it doesn't make as much of a difference. A $500 15" laptop or a $2000 15" laptop is a big difference; a $199 7" tablet or a $299 iPad mini is not that big of a difference.
When it comes to phones, the cheaper ones are going to affect the volume going forward now that Nokia is dead in the water so the sales volume to developing markets is going to be huge. This isn't a high profit market though. I fully expect Samsung and others to cut margins, sell loads of devices into developing countries and Samsung alone might top 1 billion smart device sales per year but their profit won't grow. Apple will stick to what they do and end up making the same or more profit for a fraction of the volume, same as they do with the Mac.
They have different strategies. Samsung is the type that thinks the customer is always right, Apple thinks the customer doesn't know what they want until they get it so they make the call. Samsung says 'so you want a big phone, small phone, medium phone, yellow, green, pink, with stylus, no stylus, in plastic and metal, with removable battery, you got it'. Apple says 'here's a couple of phones that make reasonable compromises and that's it because too many options undermines having choice'. If people don't like Apple's strategy, they go with Samsung. So far, it's pretty evenly split. Apple doesn't need to take the whole market, nor does Samsung and neither of them will.
They are still up YoY, QoQ is meaningless. That being said they are getting hit by the Nexus phones and tablets as more and more consumers wants pure Android, easy upgrades and no bloatware.
Must be fun to compete in a market where you're OS maker is dumping hardware at cost, enjoy...
Well both the numbers are meaningless if you just compare them using simple arithmetic.
But if you have operational knowledge, you can understand or interpret them better.
You "only" need to control the shipper and jailbreak the phone. You'll need physical access to the phone (Hence, the need to temper with the shipping process). And it's not just iPhone. All phones are vulnerable to this. If NSA runs Apple, they don't even need to bother the shipper.
But Android phones are more vulnerable to malware (which will include hacking attempts remotely).
I think you have missed the point. You need to know that phone A is going to person B, in order to do your thing.
He's saying Samsung's mobile phone sales *decreased*, but overall revenue was propped up by other electronics sales.
Increase in marketing expense and holiday shopping should have boosted their mobile phone sales too. Apparently, they didn't help much against low cost alternatives and Apple's new phones.
Quote:
Originally Posted by xSnow
Samsung's revenue includes Consumer Electronics department (domestic electronics, like TV), which contributed to that "slightly up revenue". Samsung's Mobile department dropped 9% in revenue and 18% in profit QoQ.
Yes, I know the divisions performed differently, but this article was about Samsung's company-wide earnings. Those company-wide earnings didn't decrease based on a decrease in revenue; instead they decreased based on an increase in expenses.
"Samsung's two major challenges for 2014 are to maintain its mobile-phone leadership in... the U.S., ....[and] knock Apple iPad from its perch," said Neil Mawston of Strategy Analytics.
Comments
But... but... but Android has much greater market share so it's really Apple and the iPhone that's doomed. Wall Street is fairly certain that Apple will be lucky to move a few million iPhones in all of 2014 on China Mobile because almost no consumer in China can afford an iPhone. Besides, the Chinese consumer only wants smartphones with a minimum of a 4.7" display and Apple doesn't make an iPhone that size.
/s
I can't wait to see what miracle Samsung is going to create with the Galaxy S5 in order to achieve high sales. The S4 was probably the most feature-laden Android smartphone available last year and if that didn't sell as well as expected it was because consumers didn't need that complex a smartphone and many consumers actually settled for the giveaway Galaxy SIII which was more than satisfactory. Once Apple starts selling a large display iPhone that will be one less advantage the Galaxy S will have over the iPhone.
Apple is outselling Samsung's large screen phones, the fall in profit indicates people who choose Samsung phones are buying their cheaper, smaller screened models.
Not sure what figures ur referencing. Samsung's Mobile department dropped 9% in revenue and 18% in profit year over year. If ur a big enough fan of samsung that you're referencing a division larger than mobile, you should probably start reading refrigerator insider and microwave insider as well.
Samsung's revenue includes Consumer Electronics department (domestic electronics, like TV), which contributed to that "slightly up revenue". Samsung's Mobile department dropped 9% in revenue and 18% in profit year over year.
@Daveinpublic: ;
@Daveinpublic: ;
That is right.
Still, Samsung's Mobile department dropped 9% in revenue and 18% in profit QoQ.
It probably has a lot do to with the fact that the S5 is coming out soon -- Apple sales often peaks in 4Q (or 1Q for Apple); then steadily declines until the next iPhone release. Samsung's profit is likely to surpass Apple's in 2Q and 3Q this year.
I think it's pointless to sponsor every single major world sports events (eg, the summer / winter Olympics), or buy celebrity endorsement -- though not all of them are bad (eg, Jay-Z bad, LeBron James cool). Now, I don't think all of Samsung's 2013 marketing budget $13B went into advertising and celebrity endorsements, I heard a large chunk of their marketing expenses pay for rebates, etc, etc.. Anybody know the exact break down?
Yes, a large chunk went into the government bribe slush fund and the rest was used to pay astroturfing South Korean high school student.
They are still up YoY, QoQ is meaningless. That being said they are getting hit by the Nexus phones and tablets as more and more consumers wants pure Android, easy upgrades and no bloatware.
Must be fun to compete in a market where you're OS maker is dumping hardware at cost, enjoy...
The mods have it.
And I'm here checking under my shoes.
They are still up YoY, QoQ is meaningless. That being said they are getting hit by the Nexus phones and tablets as more and more consumers wants pure Android, easy upgrades and no bloatware.
Must be fun to compete in a market where you're OS maker is dumping hardware at cost, enjoy...
Indeed I bought a Nexus over an S4 because of how filled with crap it was. It's a great market for the consumer at the moment. Sony, Asus, LG et al are all viable competitors and are also trying to explore new markets
.
So Samsung's lunch is being eat from the bottom, like they could not see that coming. This is the problem in the market place, when you are trying to ship the most cheap stuff there is always someone who can go even lower than you. In Apple case when you only interested in the premium market place its hard to a competitor to come in and eat your lunch.
In the case of Samsung they are trying to compete in both markets and getting beat from above and below. they being squeezed on both sides. They can not make enough on the high end to allow them to give away the cheap stuff and fend off their no overhead competitors.
Is that what that was? I thought someone ate bad cheese and farted.
This is wonderful news. Truly.
A race to the bottom is usually a very expensive game. Good luck Samsung.
Apple didn't do this with the Mac to the extent PC manufacturers did, they stuck to high margins and prices. While that has resulted in 5% global Mac ownership, they maintain their profit and are still competitive in volume with individual counterparts. The iOS devices haven't suffered the same lower sales volume. The ownership is roughly 700 million iOS vs 1 billion Android so assuming those two make up 95% of all modern smart devices, they'd have iOS with 39% marketshare and Android 56% and at least 1/5th of the Android ones are on 2.x. This is partly because although Apple maintains margins and prices, the price points are low enough that it doesn't make as much of a difference. A $500 15" laptop or a $2000 15" laptop is a big difference; a $199 7" tablet or a $299 iPad mini is not that big of a difference.
When it comes to phones, the cheaper ones are going to affect the volume going forward now that Nokia is dead in the water so the sales volume to developing markets is going to be huge. This isn't a high profit market though. I fully expect Samsung and others to cut margins, sell loads of devices into developing countries and Samsung alone might top 1 billion smart device sales per year but their profit won't grow. Apple will stick to what they do and end up making the same or more profit for a fraction of the volume, same as they do with the Mac.
They have different strategies. Samsung is the type that thinks the customer is always right, Apple thinks the customer doesn't know what they want until they get it so they make the call. Samsung says 'so you want a big phone, small phone, medium phone, yellow, green, pink, with stylus, no stylus, in plastic and metal, with removable battery, you got it'. Apple says 'here's a couple of phones that make reasonable compromises and that's it because too many options undermines having choice'. If people don't like Apple's strategy, they go with Samsung. So far, it's pretty evenly split. Apple doesn't need to take the whole market, nor does Samsung and neither of them will.
Well both the numbers are meaningless if you just compare them using simple arithmetic.
But if you have operational knowledge, you can understand or interpret them better.
You "only" need to control the shipper and jailbreak the phone. You'll need physical access to the phone (Hence, the need to temper with the shipping process). And it's not just iPhone. All phones are vulnerable to this. If NSA runs Apple, they don't even need to bother the shipper.
But Android phones are more vulnerable to malware (which will include hacking attempts remotely).
I think you have missed the point. You need to know that phone A is going to person B, in order to do your thing.
He's saying Samsung's mobile phone sales *decreased*, but overall revenue was propped up by other electronics sales.
Increase in marketing expense and holiday shopping should have boosted their mobile phone sales too. Apparently, they didn't help much against low cost alternatives and Apple's new phones.
Samsung's revenue includes Consumer Electronics department (domestic electronics, like TV), which contributed to that "slightly up revenue". Samsung's Mobile department dropped 9% in revenue and 18% in profit QoQ.
Yes, I know the divisions performed differently, but this article was about Samsung's company-wide earnings. Those company-wide earnings didn't decrease based on a decrease in revenue; instead they decreased based on an increase in expenses.
All day, everyday.
AI's spin on this story differs significantly from the rest of the tech press. It's worth hearing this story from all sides.
Well duh. It is *Apple* Insider, so count on everything being skewed pro-Apple and anti-Samsung. =p
A miss is a miss and not good for Samsung at all. I think the 'big Gorilla' for Sammy is if Apple releases a bigger phone.
The 'big Gorilla' for Apple is if carriers effectively kill subsidies Apples profits are in serious trouble.
While AI likes to blow up "RECORD SALES" for Apple, they neglect Apples declining profits.
While blowing up a quarterly miss for Samsung, they neglect strong overall profit growth.
2012 2013 Delta
Apple 55.2b 49b 11% decline
Samsung 27.1b 34.3b 27% increase
Samsung still had solid growth, just not as much as anticipated.
Apple needs to turn their trend around and make more money in 2014 than they did in 2013.
If both companies continue their 2013 trajectories into 2014 Samsung's profits will exceed Apple's
Excuse me, did you say that Sammy leads Apple in US smartphone profits? I don't think so. Sammy doesn't even beat Apple in U.S. smartphone market share. Apple is at 42%, Sammy at 26%, according to http://appleinsider.com/articles/14/01/16/apples-iphone-now-represents-42-of-smartphones-owned-in-the-us---npd
Also, why must Sammy "knock the iPad from it's perch"? Why doesn't Sammy just innovate and create something new to make profits from?
I notice that nobody is asking "Why can't Samsung innovate any more?".