After nearly a year of breaking profit records, Samsung has today released earnings guidance for Q2 with a notable dip attributable to lackluster Galaxy S9 sales.
Samsung reports that, during Q2 2018, the company saw a Consolidated Operating Profit of about 14.8 trillion won, with Consolidated Sales of about 58 trillion won. Year-over-year, that shows a slight dip in sales of 0.7%, but an 11% overall increase in profit.
For Samsung, that’s obviously not doom and gloom, but as The Verge points out, the last several quarters have been record-breaking after record-breaking. Last quarter, for instance, saw higher profit at 15.64 trillion won, and higher revenue at 60.56 trillion won.
Analysts speaking to Financial Times and WSJ attribute the drop to lower-than-anticipated Galaxy S9 sales. Apparently, this year’s flagship is seeing the lowest sales of any Samsung flagship since the Galaxy S3 back in 2012.
Shipments are expected to top off at around 31 million units this year, where the Galaxy S7 sold around 50 million in total. In either case, Samsung is still selling a whole lot of phones, but there’s a noticeable decline going on here.
Samsung has been the king of Android for quite a while, and even though the market is slowing down as a whole, I see this declining popularity as a telling sign. Part of Samsung popularity could be attributed to uniquely offering things no one else did in a package that just about anyone could afford.
Now, the company’s competitors have caught up to that. The Galaxy S9 isn’t as unique, it’s just a really solid offering in a sea of great smartphones. Clearly, this has people willing to consider other options.
Apple’s iPhone X and even iPhone 8 have been growing dramatically in US sales, and I’d say Google’s Pixel lineup has probably made some sort of dent in Samsung’s bottom line as well.
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