Samsung Profits Fall 58% Amidst Competition From iPhone 6, Low-End Smartphones

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Posted October 7, 2014 at 3:05pm by iClarified

Samsung revealed that its third-quarter operating profit likely fell 58% to 62% from a year earlier, reports the WSJ. That's even worse than the low end expectations of analysts and the fourth quarter in a row with declining operating profit.

Samsung said that smartphone shipments "increased marginally"; however, profit margins declined due to lower prices and higher marketing expenses.

The company is facing increased competition at the high-end from the new Apple iPhone 6 and iPhone 6 Plus which have larger screens, previously a distinguishing feature for its devices. The company is also facing intense competition at the low-end from Chinese handset makers.

Samsung's third quarter included just twelve days of iPhone 6 sales and analysts expect the impact of the new Apple smartphones to be even larger in the fourth quarter.

Nomura analyst C.W. Chung says that without essential differentiators like Apple's design cachet and a software ecosystem, Samsung is headed toward becoming a maker of commoditized hardware. Chung predicts that its operating margins for handsets and tablets will decline to 11% in 2016 from 21% in 2013.

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Samsung Profits Fall 58% Amidst Competition From iPhone 6, Low-End Smartphones

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marc767 - October 10, 2014 at 11:09am

They could always fall back on their washing machine business?

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gamerscul9870 - October 13, 2014 at 10:11am

As much as their TV has done great (not the 'smart' TV) vizio I find better and perfect.

gamerscul9870 - October 9, 2014 at 2:53pm

More like truth from your world that makes half sense. Assembled I the usa if you bother reading the print.

trolololo - October 8, 2014 at 8:07am

Samsung ain't the only one using Android OS unlike apple whose solely the only one using iOS.... HTC, Asus, LG, HP, Sony, etc. companies uses Android for their phones or tablets so there's alot of competition but if you combine them together with Samsung by basing only its OS, i bet Android on iOS anytime worldwide....

marc767 - October 8, 2014 at 9:20am

Trololo, I think you might be describing yourself buddy. Take a cold shower and cool down. Apple and android have to different models. Android is open source and allows any OEM TO HITE THEIR SOFTWARE. Apple doesn't. Each model has its benefits, but at the moment iOS is strong and growing. Android is cheaper and more accessible with more options. If you want ios you must buy apple, but they have control over all their primary hardware and software and ecosystem, with a better quality and end user experience.

Great! - October 8, 2014 at 2:54am

Samsung fans experiencing thermonuclear head explosions. They still don't get it. Also all that talk about having an open OS...when will they wake up and realise that Android is neither secure nor fully open. You think your data is safe? You are in the Google Matrix my friend! I'm not saying Apple is better here, but don't be deluded to think that Android gives you freedom.

Mrstudz - October 7, 2014 at 10:08pm

This "article" is a paid for viral marketing scheme by apple pr..... I mean who makes a graph called best days behind it ????? It's over the top blatant lol. Just ignore the fact Samsung makes every processor for every device ever made lol. Oh and ssd disks ram screens

marc767 - October 8, 2014 at 9:14am

Keep talking to yourself mrstudz, they say it's therapeutic.

Samsuck - October 7, 2014 at 8:08pm

May be Samsung should make a bigger phone and hope ppl will buy it!

NotFanBoi - October 7, 2014 at 5:29pm

I hope the Walled-Garden ecosystem of iDevices finally comes to an end. I am tired of sheep/zombie/apple-fanbois acting like Apple's stuff is always way better, and that it's only a matter of time before the 'rest of the world realizes it and buys into the Apple cult.' I will die happy knowing I never bought into that cult. I will buy hardware from someone who lets me do whatever I want with the thing I bought, not from someone who controls both ME and my device, and ONLY lets me do whatever I can find on THEIR menu of things I am allowed to do. In the end FREEDOM will prevail.

kapnkirk24 - October 7, 2014 at 6:05pm

Well, we're glad that has been your life's mission. Just kidding no we aren't.

kapnkirk24 - October 7, 2014 at 6:06pm

Sorry

gamerscul9870 - October 7, 2014 at 8:08pm

No one cares about your flattered reactions anyway, sorry.

garyhhh - October 8, 2014 at 1:32am

But yet here you are posting on a apple related site, funny that

NotFanBoi - October 8, 2014 at 6:03pm

That goes to show you that you get personally offended and vocally bothered when someone does not have the same thing as you. Sad, really!

marc767 - October 7, 2014 at 4:40pm

What a pity! I thought their ads would help them. And the apple wAtch hasn't even come out yet. Well they make nice phones, but apples got stuff they can't invent or buy with money. Apple all the way.

iDood - October 7, 2014 at 4:20pm

Samsung's commercials maybe true but childish and unprofessional. I worked in a customer service and one of the thing that thought me, to never put down or belittle your competitor.

NoGoodNick - October 7, 2014 at 4:19pm

I'd hardly claim that Samsung's best days are behind them. The main problems, as I see it, is that everyone else is catching up with their most popular phone (their newer phones never did as well), as well as increased competition in China. While I'm an Apple fanboy, I'd rather see some healthy competition (instead of constant snipping at each other). A strong Samsung makes Apple better. Give them time, they had a misstep with their last phone flagship product, and it'll take them time to get their next model out.

Apple 4life - October 7, 2014 at 4:00pm

Highest thing they know is make stupid ads against Apple. Samsuk has the worst marketing strategy of all times. I wonder what they before releasing stupid ads mocking Apple.

Techno - October 7, 2014 at 3:46pm

It pretty much says,"We will give it away cheap and put out a lot of commercials to get more business" Didn't work out like they would like it to be.

Darth Vader - October 7, 2014 at 3:46pm

Poor Samsung, why not make another commercial crying about how the iPhone is copying you. Hahaha

gamerscul9870 - October 7, 2014 at 3:45pm

BTW I'm mentioning Samsung being buthurt, now you!

Techno - October 7, 2014 at 3:50pm

Should I leave this comment and allow you both a little privacy? Wolf and SSamsung having a BHurt moment.