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Samsung Electronics is struggling to carry on to its crown because the world’s top-selling smartphone maker, compounding a mounting disaster at South Korea’s largest firm.
The Korean tech big was the one one of many prime 5 international smartphone makers to expertise falling shipments within the third quarter of this 12 months, shedding market share to longtime US rival Apple and Chinese language contenders providing slick new foldable units.
Samsung’s third-quarter international market share fell from 21 per cent to 18 per cent year-on-year, in line with IDC, with its lead over Apple minimize to 0.6 per cent. Analysts estimate that its smartphone division’s working revenue dropped by as a lot as 30 per cent over the identical interval.
“Samsung’s smartphone enterprise is within the doldrums,” stated Park Kang-ho, an analyst at Daishin Securities. “The corporate hoped that foldable telephones would give it an edge over Apple however shopper response has been lukewarm. Now Chinese language corporations are pushing foldables to steal Samsung’s market share.”
Samsung’s 12-year reign because the world’s prime smartphone maker by handset gross sales was ended final 12 months when Apple briefly took the highest spot, earlier than the Korean group regained its lead within the first quarter.
Nonetheless, analysis group TechInsights expects Apple’s new generative synthetic intelligence options to assist energy the US firm previous Samsung subsequent 12 months.
“Chinese language manufacturers have develop into way more aggressive not simply in costs but in addition in capabilities,” stated a Samsung employee on the smartphone division. “We’re involved about our rivals’ strikes and maintaining a tally of how the brand new iPhones carry out.”
The Asian firm’s smartphone struggles come at a important level. It has been hit by a collection of failures at its semiconductor division, which accounts for 60 per cent of Samsung’s working revenue. The pinnacle of the chips unit issued a uncommon apology this month after falling additional behind smaller crosstown rival SK Hynix within the growth of cutting-edge reminiscence chips for AI-related {hardware}.
Observers argue that lots of the issues on the conglomerate’s varied divisions are interrelated, noting studies that Samsung could also be pressured to show to US rival Qualcomm’s cellular software processor chip for its upcoming flagship Galaxy S25 smartphone due to decrease yields of in-house Exynos processors. Samsung declined to touch upon the studies. The corporate’s share value is down 27 per cent on a 12 months in the past.
“Samsung is dealing with mounting structural issues in most of its companies the place it was dominant, from chips to smartphones and shows, due to its complacency and forms,” stated Park Ju-geun, head of Seoul-based company analysis group Leaders Index.
Within the smartphones market, Samsung pioneered foldable units, however ceded prime spot earlier this 12 months to Chinese language rival Huawei, which had a 27.5 per cent share of the foldables market within the second quarter, in contrast with Samsung’s 16.4 per cent, in line with IDC.
Whereas foldables solely account for 1.2 per cent of the worldwide smartphone market, they represent the fastest-growing section of an in any other case comparatively stagnant sector.
Huawei additionally notched up a symbolic victory final month when it launched the world’s first “tri-foldable” cellphone, the Mate XT, which comes with a near-$3,000 price ticket.
Honor, one other fast-growing Chinese language rival, mocked the Korean firm at a commerce present in Berlin final month by engraving a “micro apology” on its Magic V3 foldable to customers who had endured Samsung’s “chunkier various”.
Samsung is attempting to battle again with a slimmer and lighter “Particular Version” Galaxy Z Fold 6 however its delayed home launch on Friday was closely criticised as the brand new mannequin didn’t really seem in shops. Samsung stated it couldn’t put together sufficient preliminary quantity.
The corporate added its flagship Galaxy S24 collection with AI options, launched in January, has been “warmly obtained,” exceeding its expectations, including that Galaxy AI can be accessible on round 200mn Galaxy units this 12 months.
The important thing check, analysts stated, would be the efficiency of its Galaxy S25 flagship due out in January, which must tackle iPhones and Android-powered units boasting AI options.
Jene Park, an analyst at Counterpoint Analysis, stated: “They really want to point out differentiated AI companies that may wow individuals to proceed to benefit from the first-mover benefit.”
