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The competition from low-cost vendors is starting to impact Samsung's financial results, as well as its position in the industry. To maintain its No. 1 smartphone market share, Samsung must focus on attracting buyers in regions -- such as China -- where local brands are rising quickly. At the same time, Samsung will face heightened competition on the high end from Apple when the Cupertino, Calif., company launches its newest devices -- including anticipated iPhones with bigger screens and an iWatch -- this fall. A big differentiator for Samsung's devices has been their larger displays, and there are worries it could lose share to Apple once the iPhone 6 hits the market.
Earlier this month, Samsung still had hopes the current quarter would be better, At that time, it said increased shipments of its new smartphone lineup -- which market watchers believe will include the Galaxy Note 4 phablet (phone/tablet hybrid) -- should boost results, Samsung also expected its display business to benefit from higher shipments of mobile devices, and performance in its memory chip business should improve because of seasonality, But not everyone was quite as sure, Analysts from Daishin Securities said earlier this month that competition may actually get worse for iphone case 10 foot drop Samsung in the third quarter "with many consumers waiting for Apple's new iPhone."Samsung appeared to agree on Wednesday as it warned about tough times to come in the second half of the year, Along with worries about competition on pricing for smartphones, Samsung said its chip business, excluding its memory chips, could post a loss because of weak demand and "investment spending" for next year..
The company added that the mobile market should improve due to stronger seasonal demand in the second half of the year. Along with releasing devices around the globe, Samsung said it would focus in China on responding "to growth in the LTE market by enhancing the competitiveness of its high-end smartphones and mass-market products." It also said tablet demand should post "substantial growth" in the fourth quarter, driven by year-end seasonal promotions. Even with its efforts, it's unclear whether Samsung will improve profit margins, the company said.
Apple, meanwhile, last week reported earnings in its fiscal third quarter topped Wall Street expectations, iPhone sales, revenue results, and fourth-quarter guidance weren't quite the blowout analysts had iphone case 10 foot drop hoped for, but they all represented gains from the previous year, Apple also said its strength in China was surprising even to the company, Overall, Apple sold 35.2 million iPhones during the quarter ended June 28, helping the device remain its biggest moneymaker, Analysts, on average, had expected Apple to sell 35.9 million iPhones in the period..
The only particularly weak area for Apple in the period was iPad sales, which dropped for the second quarter in a row. Apple also sold 13.3 million iPads in the most recent quarter, down 9 percent from a year ago. Analysts expected the company to sell about 14.4 million iPads. The company said inventory issues and lower demand were hurting sales, while Best Buy CEO Hubert Joly recently told Recode that tablet sales are "crashing."Samsung in early July warned that its second-quarter operating profit likely fell about 25 percent from the previous year to 7.2 trillion won ($7.12 billion). It also said sales likely totaled 52 trillion won, a 9.4 percent decline. Both figures fell short of analysts' projections for the June period. The results marked Samsung's worst in about two years and the third straight quarterly profit decline.
Along with blaming the stronger won and smartphone slowdown, Samsung at the time said tougher competition in the Chinese and European markets iphone case 10 foot drop led to higher inventories of medium- and low-end smartphones, It also spent more on marketing to reduce inventory held by retailers or on trucks in preparation for its third-quarter peak season and new phone launch, Samsung also noted that its earnings were hurt by increased price competition and weaker demand for 3G products in China ahead of expected growth of 4G LTE products in that market, And the company said tablet sales were "sluggish" as customers held onto them longer than smartphones before buying new models and as people opted for 5- to 6-inch phablets -- phone and tablet hybrids -- over 7- to 8-inch tablets, The weak demand for mobile devices in turn affected Samsung's semiconductor and display businesses, which are key suppliers for Samsung's own gadgets..
Analysts from KDB Daewoo Securities noted earlier this month that a big problem for Samsung is the rise of rivals hawking cheap phones. "It will likely be difficult for the company to regain market share if it loses ground in the fast-growing low-end, emerging market segment," the analysts said. "Given the aggressive pricing strategies of Chinese competitors like Xiaomi and Lenovo, we believe [Samsung] will have little choice but to follow suit in order to defend its market share."Updated at 5:30 p.m. PT: with additional details from Samsung's report.
The Korean electronics giant, which posted a 25 percent drop in operating profits, says the second half of 2014 "will remain a challenge" as price competition in smartphones hurts profitability, Samsung on Wednesday posted a 25 percent drop in second-quarter operating profits, marking the third straight quarter of profit declines as competition heats up in the smartphone market, Be respectful, keep it civil and stay on topic, We delete comments that violate our policy, which we encourage you to read, Discussion threads can be iphone case 10 foot drop closed at any time at our discretion..