14 DAY TRIAL // Samsung Electronics has just announced its third quarter results and they do show earnings declined following the Note 7 discontinuation. The South Korean company states that its mobile business has seen a downfall caused by the Note 7 situation.
Samsung Electronics intends to focus on its semi-conductor and components business, as well as on expanding sales of flagship smartphones and regaining consumers’ trust. The mobile business has seen a decline compared to the previous quarter, but the company says that its smartphone shipments remained solid due to stable sales of the Galaxy S7 and S7 edge, as well as growing sales of Galaxy A and J series.
A study by market research firm IDC shows that Samsung’s share of the worldwide smartphone market dropped to 20% in the third quarter. This is the lowest market share recorded by Samsung since the fourth quarter of 2014, when it recorded a 19.9% share.
Samsung’s market share in the past quarter dropped 3.3%, compared to the 23.3% share that it recorded in the third quarter of 2015. Apple recorded the second highest shipment volumes, of 45.5 million units in the third quarter, gaining 12.5% of the market.
Fourth quarter results will reveal the damage that the Note 7 has caused
Although the Galaxy Note 7 recall had some effects on the company’s business, it seems that Samsung’s volumes went up 1.0% compared to the third quarter of 2015. But this study excludes Galaxy Note 7 shipments for recalled and unsold smartphones in the third quarter. Results for the last quarter of this year will be conclusive when it comes to revealing the damage that the Note 7 situation has caused.
In the third quarter, Samsung’s dominance was unchallenged in the short term, but the effects of the Note 7 discontinuation remain to be seen. "In a market that is otherwise maturing, Christmas has come early for vendors looking to capitalize with large-screened flagship alternatives like the Apple iPhone 7 Plus and Google Pixel," said Melissa Chau, associate research director, Mobile Devices.
Samsung continues to compete against Apple in the smartphone market and some consumers might switch towards the latest iPhones, thus determining an increase in market share for the Cupertino company, as well as other smartphone makers.
