Samsung Expected to Post Loses In The 3rd Quarter

[arftech]

Samsung Is expected to report significant loses perhaps due to their smartphone division.

http://9to5google.com/2014/10/06/samsung-misses-earnings-q3-60-percent/

 

[Chodite]

Something tells me they'll be just fine

 

[mib1800]

What a deceiving title. It is expected lower profit not losses.

 

[Esoom]

Samsung is another BlackBerry just waiting to happen.

What's really going to kill them is the race to the bottom, they weren't successful in moving upmarket.

I just got a OnePlus One, and despite some early software issues, the current release of CM is slick as whale ****.

$349 for a flagship Android phone is disruptive, if they can transition to traditional online sales, they have a winner on their hands, and I gotta tell you, Samsung is in trouble.

People have been comparing Android's adoption to Windows, and forgetting how the clones decimated so many established manufacturers, resellers. Chinese made and marketed smartphones are going to rule the world, and the days of Samsung making billions from smartphone sales is drawing to a close.

 

[jamezr]

Something tells me they'll be just fine

I think they will just fine too......they are headed in the right direction with the Note 4 and Alpha. Let's see what happens with the S6.

 

[LIVEFRMNYC]

Samsung is another BlackBerry just waiting to happen.

 

[aeboi]

No, OnePlus should never be used in an argument. As much as I liked my $350 OPO, OP dug its own grave with the whole invite system and non-existent support, which is what you get with a budget flagship. You're better off using Xiaomi as an example.

Samsung isn't in trouble. Blackberry mainly produces phones and software for its phones. Samsung produces everything from cosmetics to washing machines. As long as they continue producing Android phones instead of straying off with Tizen they'll be fine.

 

[Chodite]

 

[Technarchy]

I think they will just fine too......they are headed in the right direction with the Note 4 and Alpha. Let's see what happens with the S6.

Personally I am not all that convinced that Note 4 and Alpha DNA are the "right direction".

Samsung could put more effort into their external designs, but I would prefer they go about it in a different way compared to the Note 4 and Alpha.

 

[jamezr]

Personally I am not all that convinced that Note 4 and Alpha DNA are the "right direction".

Samsung could put more effort into their external designs, but I would prefer they go about it in a different way compared to the Note 4 and Alpha.

I hope they listened to all the complaints about TW and take cue from HTC and blend the hardware and software. Stop releasing so may products and make the ones they do release better. Stop going bigger with the Galaxy line stay at 5 inches. Anyway that is my 2 cents......YMMV.......

 

[Technarchy]

http://www.theverge.com/2014/10/6/6921255/samsung-q3-2014-earnings-guidance

Revenue is down 60 percent from one year ago.

That's not small potatoes.

Today, Samsung issued guidance for its forthcoming Q3 2014 earnings, telling investors that it expected profits of 4.1 trillion won ($3.8 billion) for the quarter. That's down 60 percent from the record-breaking revenue that the company booked in Q3 2013. Sales of approximately 47 trillion represented a 20 percent decline over the previous year.

 

[Chodite]

Time to sell more microwaves and washing machines! Luckily, their mobile phone department is untouchable right now and competition has no answers.

 

[arftech]

Time to sell more microwaves and washing machines! Luckily, their mobile phone department is untouchable right now and competition has no answers.

You mean competition from other Android offerings?

 

[spinedoc77]

http://www.theverge.com/2014/10/6/6921255/samsung-q3-2014-earnings-guidance

Revenue is down 60 percent from one year ago.

That's not small potatoes.

I wonder how much of that is due to the cheap android phones though. I mean Samsung could take any design direction, they could make the perfect phone yet still be hindered by price.

It's too bad they are so slow to move. The iPhone having such popularity in the expensive/high end and producing a larger screen couldn't be more obvious. The cheap Chinese phones have also been storming the market for quite some time. Why has Samsung been so slow to respond? IMO they haven't even responded YET. The alpha is not really as high end as an iPhone. Really the first true high end phone is the Note 4 and that's not even out yet, Samsung stupidly didn't release it before the ip6 plus. Seems like Samsung has become too big of a behemoth to turn on a dime, reminiscent of Sony in the 90s or Microsoft a couple of years ago.

 

[aeboi]

http://www.theverge.com/2014/10/6/6921255/samsung-q3-2014-earnings-guidance

Revenue is down 60 percent from one year ago.

That's not small potatoes.

So you're comparing a low quarter to a record-breaking quarter...

 

[Lloydbm41]

So you're comparing a low quarter to a record-breaking quarter...

Samsung is doomed! Just $4 billion in 'profits'? Dooooooomed

 

[cdmoore74]

This just means that there are a lot more selection within Android vs what you had in the last 2 years. Android actually grew in numbers. You got super cheap Chinese Android OEM's starting to move in on all Android OEM's. Phones like the Motorola G are very good budget phones. LG was the red headed step child 2 years ago and now they rival HTC and Motorola.
This fall has been the most difficult in picking a top notch phone because there have been so many at various price points. I don't believe one OEM (Samsung) should be the only company making decent phones. I could make a case for all the phones below. 2015 is going to be buck wild.

2014 Models
HTC M8
Samsung S5
LG G3
Moto G
Moto X
One Plus One
Nexus 6
Sony Z3
Sony Z3 compact
Note 4
Note Edge
Droid Turbo

 

[LIVEFRMNYC]

This just means that there are a lot more selection within Android vs what you had in the last 2 years. Android actually grew in numbers. You got super cheap Chinese Android OEM's starting to move in on all Android OEM's. Phones like the Motorola G are very good budget phones. LG was the red headed step child 2 years ago and now they rival HTC and Motorola.
This fall has been the most difficult in picking a top notch phone because there have been so many at various price points. I don't believe one OEM (Samsung) should be the only company making decent phones. I could make a case for all the phones below. 2015 is going to be buck wild.

2014 Models
HTC M8
Samsung S5
LG G3
Moto G
Moto X
One Plus One
Nexus 6
Sony Z3
Sony Z3 compact
Note 4
Note Edge
Droid Turbo

I agree, it's like an arms race now and we the consumers are benefiting from it.

 

[Savor]

Peaks and valleys. No company can go record quarter every year. Apple's had its own valleys too.

I was checking the reviews of the Samsung Galaxy Alpha and Engadget called it the most beautiful Samsung smartphone ever. Sales of the Note 4, Note Edge, Core II, and Alpha still haven't been accounted for yet. The Alpha really can be the beginning to a new and sexier Samsung.

Still, competition is very, very strong. I thought last year we had many breakthrough devices. This year might have some rehashing but the choices are abundant. I can name at least 20 different devices I wouldn't mind owning starting from Apple to Samsung to LG to HTC to Sony to Asus to Motorola to Nokia to Oppo to OnePlus to Xiaomi to Gionee. Even third tier like Gionee has the Elife S5.1 (world's thinnest) that has some appeal to me.

 

[Twixt]

http://www.theverge.com/2014/10/6/6921255/samsung-q3-2014-earnings-guidance

Revenue is down 60 percent from one year ago.

That's not small potatoes.

If you read the article of your link you will notice it is about operating profit and not revenue...

For your knowledge, Operating Profit = Revenue - Cost of Goods sold - Operating Expenses - Depreciation & Amortization

Can you see the difference?

 

[pedromcm.pm]

I think they will just fine too......they are headed in the right direction with the Note 4 and Alpha. Let's see what happens with the S6.

60 % drop yearly in profits and you think that they are on the right path? WoW.

 

[Fireblade]

Image

This one nails it better

 

[pdqgp]

Not surprising that Q3 is coming in poor. It's always darkest before dawn and with Q4 being the quarter new devices launch, buyers are always in waiting mode. Also, the costs to market said new products has been incurred. Again, typical that the operating margins will decline due in part to increased marketing costs. They are also selling existing products for lower prices to help clear them out.

Looking at the numbers, they sold more phones than last quarter but they sold them for less which again, combined with higher marketing costs is going to hit the bottom line.

IMO Samsung is feeling the heat from Sony, LG and others in the android space. The S5 is a nice phone, but IMO Sony is the one I would go with if I were to choose between the two. The only reason I'm in the Note line is for size and the S-Pen.

IMO they need to ditch the strong focus on Touch Wiz and save some moeny. They also need to trim down the number of models offered.

 

[jamezr]

Not surprising that Q3 is coming in poor. It's always darkest before dawn and with Q4 being the quarter new devices launch, buyers are always in waiting mode. Also, the costs to market said new products has been incurred. Again, typical that the operating margins will decline due in part to increased marketing costs. They are also selling existing products for lower prices to help clear them out.

Looking at the numbers, they sold more phones than last quarter but they sold them for less which again, combined with higher marketing costs is going to hit the bottom line.

IMO Samsung is feeling the heat from Sony, LG and others in the android space. The S5 is a nice phone, but IMO Sony is the one I would go with if I were to choose between the two. The only reason I'm in the Note line is for size and the S-Pen.

IMO they need to ditch the strong focus on Touch Wiz and save some moeny. They also need to trim down the number of models offered.

^^^^^ this^^^^^
Focus more on quality and less on quantity.....

 

[CEmajr]

On the high end Samsung is beginning to learn that it doesn't have the brand loyalty of Apple. Android users will switch to other manufacturers without much issue. It's far easier and likely for an Android user to go from Samsung to Sony/LG/HTC than it is for an iPhone user to jump to Android. The loyalty is to Android as an OS, not necessarily Samsung as the manufacturer. There have been several high end Android flagships to choose from this year so the Galaxy S series is no longer seen as the sole premium Android device. Add in that Apple just removed their large screen niche and phablet market domination with the 6/6+ and it spells further trouble.

On the low end things are very difficult as well. Getting hammered by the likes of Xiaomi, ZTE, Huawei, etc. in markets like China and India has caused them to react by lowering prices in order to remain relevant and hold onto marketshare, which also effectively decreases profits. While Apple still seems to have their niche in such markets too with 4 million 6/6+ preorders in China alone.

60% is significant. That's a very large YOY drop. Especially when smartphones constitute such a large portion of the company's overall profit. I'm not sure what they can do to recover but it will be interesting to see. This might just be the new normal for them.