Apple is not the only company facing a slowdown in their smartphone sales: Samsung is also facing competition from new Chinese players. Its results for 2018 are proof of this.
2018 was the year when the giants began to shake. For the first time, Apple had to report lower results due to disappointing mobile sales.
The reasons for this fall are the ever-increasing competition from Chinese players. The number one mobile phone, Samsung, also suffered it and ended up following his rival.
Samsung’s profits are down.
Its preliminary results for the fourth quarter of 2018 are a warning of disappointing results. The firm should record an operating profit of between €8.3 and €8.5 billion, corresponding to a 28% decrease compared to last year.
Moreover, Samsung’s turnover is estimated at €45.9 billion, a 10% decrease compared to last year.
The smartphone and components in focus
The reasons for this slowdown are mostly the same as Apple’s. Samsung is facing increasing competition from Chinese players such as Xiaomi or Huawei in two principal markets: China and India. It is why the manufacturer has started new seduction operations with models like the Galaxy A8S that we have seen on the Shenzhen market.
That’s not all. Samsung has also become the number 1 chip manufacturer in the meantime, but the outlook for this market is not good. Competition is once again increasing, and inventories have been built on technologies such as LPDDR4 or UFS 2.1, which are now well installed.
Nothing is for sure in this market.
However, this weakness in 2018 can quickly be offset in 2019. Unlike Apple, we have a concrete vision of the company’s future: UFS 3.0 memory will be deployed in 2019, while 2020 should mark the advent of LPDDR5 RAM. These are two areas where Samsung can quickly rebound from the foundry side.
For the smartphone, the Samsung Galaxy S10 is preparing for the beginning of the year and the attention focused on its future models is very strong. Unless the manufacturer makes a big mistake, or its main competitor Huawei surprises massively in the high-end segment, they should have a perfect launch.
Finally, foldable smartphones are also preparing to make their debut, with Samsung at the top of the gondola. As with the AMOLED, the Korean brand is a leader in these technologies and should be able to quickly fill its order book… if the trend holds, of course.
While Samsung is far from being in a weak position, it is still good to see him shaking. Let’s hope that this thrill will give him the necessary fear to prevent him from resting on his laurels: Huawei is watching over the grain to take his