Samsung warns of revenue shortfall due to 'weakening overall demand' for smartphones & com...
Chief Apple rival Samsung Electronics on Tuesday warned investors that it would report disappointing results for the March quarter, foremost blaming "weakening overall demand."
The company also cited a "widening price fall among major products," linked to dropping prices for chips and LCDs, according to the New York Times. While best known in the U.S. for smartphones like the Galaxy S10 and Galaxy Fold, the company is a major manufacturer in the phone, tablet, and computer industries. Most iPhone OLED panels are made by Samsung.
Samsung has been hit by Chinese competition as well, and in fact saw its overall Chinese sales fall 25 percent in the December quarter to $13.17 billion. The Chinese government has also been fostering local chip production, leading to stockpiling in Japan and South Korea as supply outstrips demand.
Apple made a similar announcement in early January, warning that its Jan. 29 results would fall billions of dollars short of guidance. The company recorded $84.3 billion in revenue, a result of iPhone shipments being down 15 percent year-over-year. The product was hit particularly hard in China, owing to a combination of a weak economy, exchange rates, Apple's decision to hike entry prices, and above all lower-cost alternatives from local brands like Huawei.
Both Apple and Samsung are suffering from a global decline in smartphone demand. The December quarter saw shipments slide 7 percent, a fifth quarterly decline -- this may be in no small part because people are holding onto phones longer, having no special reason to upgrade unless their phone breaks, becomes too slow, or can't hold a charge. Many in the smartphone industry are pinning their hopes on 5G cellular data, which can be up to 10 times faster than high-end 4G, when widely deployed.
The company also cited a "widening price fall among major products," linked to dropping prices for chips and LCDs, according to the New York Times. While best known in the U.S. for smartphones like the Galaxy S10 and Galaxy Fold, the company is a major manufacturer in the phone, tablet, and computer industries. Most iPhone OLED panels are made by Samsung.
Samsung has been hit by Chinese competition as well, and in fact saw its overall Chinese sales fall 25 percent in the December quarter to $13.17 billion. The Chinese government has also been fostering local chip production, leading to stockpiling in Japan and South Korea as supply outstrips demand.
Apple made a similar announcement in early January, warning that its Jan. 29 results would fall billions of dollars short of guidance. The company recorded $84.3 billion in revenue, a result of iPhone shipments being down 15 percent year-over-year. The product was hit particularly hard in China, owing to a combination of a weak economy, exchange rates, Apple's decision to hike entry prices, and above all lower-cost alternatives from local brands like Huawei.
Both Apple and Samsung are suffering from a global decline in smartphone demand. The December quarter saw shipments slide 7 percent, a fifth quarterly decline -- this may be in no small part because people are holding onto phones longer, having no special reason to upgrade unless their phone breaks, becomes too slow, or can't hold a charge. Many in the smartphone industry are pinning their hopes on 5G cellular data, which can be up to 10 times faster than high-end 4G, when widely deployed.
Comments
It is time for prices to come down- way down.
Countless millions of us want a high-performance iPhone but do not give a whit about AR and do not play games on them. We do not want a degraded screen or CPU, but do not really care about the camera beyond FaceTime. What would really be nice is an iPhone with a shelf life of more than 2 years that allowed owners to buy and put in a new battery ourselves without taking the thing apart.
That would go towards answering the "worth paying for" question. If the prices have been falling as I suspect then the overwhelming majority of those 1.4 billion purchasers don't believe it requires a $700+ purchase, and overall smartphones are getting better features and hardware while costing consumers less, and drawing more folks into the market.
I think expensive smartphones are the exception. The market itself is becoming commoditized, much like HDTV's. They're all decently good.
Where the iPhone 4 was really pretty SLLLOOWWW in it's 4th year. The iPhone 6 wasn't half bad. I expect the XS to do even better. I know some think the Speed is overkill now. It's not NOW that matters so much as down the road. How well it holds up over time. Every year the next major iOS update comes out and your phone generally takes a hit in speed. The OS grows with more features, but in turn the demands of the OS goes up. This happens with any Operating System.
As for Samesung and China, Android is a race to the bottom in profits. They have to fight with everyone else making Android phones. China has their own brands that are hard to compete against. Apple has less of that effect as they are the only ones making iOS devices. How big of a Shortfall will Samesung have? Will we be in for a shocker? As in really bad or just a small shortfall?
Furthermore, if you look at the video accompanying this thread, the Samsung blows away the iPhone in performance in most areas. Now unless one plays games, they don't actually need that performance, but considering that Samsung accomplished it and Apple didn't, I believe that one has to give Samsung some credit. It seems to me that with the prices Apple wants for its phones these days, they should be superior in absolutely every respect and they're not.
I'm still using my iPhone 6. I got the $29 battery upgrade from Apple some months back and they also cleaned the port, which was giving me a lot of trouble and my perception is that even with the latest iOS is that the phone is as fast as it ever was. And for what I use it for, which is mainly email, messaging, iTunes, news, web searches and an occasional video, I really don't need more, especially at Apple's current pricing. But I will probably go for a new phone in the Fall when the new models are released.
And iPhones are better, which is why the iPhone ASP has gone up while your knockoffs have gone down. As we saw in PCs, where people said the same thing decades ago, the commoditization hurts the also-rans while leaving Apple to suck up the high-end.
StrangeDays said: You could read the advisory and see for yourself what they said rather than me interpreting it for you.
You watched it wrong. The GeekBench test of simulated real world use — iPhone blew away Samsung in single core, and in multi core the 2019 Samsung only eked past the 2018 iPhone. Most of the others were comparable, with one more big win going to iphone (Octane) and one more to Samsung. When the 2019 iPhone comes out it will likewise smoke the 2019 Samsung.