Samsung sells more smartphones this year, more than Apple and Huawei combined.
Samsung has made more sales of smartphones this year in comparison to last year, which is a good reason for the company to celebrate but this is not the only reason for it to be happy.
The multinational electronics company attained year-on-year mobile profit growth since the year 2013 in its first quarter this year. The high sales of smartphones have proved to be very profitable but it never reveals how much it has exactly sold. It is known globally for its Galaxy series, keeping aside its high-end products, it has been selling cheap economical smartphones this year.
The organization reported to ship around 84 million phones in its third quarter this year, which is 6.3% more than the same period last year, and more than the shipment of its rivals Apple and Huawei Technologies combined. Sources, such as Counterpoint, reported not just this but also the sales of its high-end products fell to 40%. 55% of its phones cost $301 per unit, which was more last year. Phones that cost below $200 had a contribution of 38% in the overall sales, which was 30% the previous year showing the rise in demand for low-end products of the company as well.
Samsung is known globally because of the production of its successful mobile phones. The shipment of products face a demand worldwide and the sales are also high because of the affordability. This also helps the company to compete with new Chinese competitors in the market because their products are not as affordable and efficient as Samsung smartphones.
The South Korean organization is not afraid of taking risks. One of its successful low-end products is Galaxy J series, which has good features and specs with an affordable price tag. An analyst, Tom Kang, said that the Galaxy J series outsold other lineups of the company’s phones in its third quarter this year.
The profit margins in its mobile phones did collapse by 7% in its third quarter in 2014, while Huawei and Xiaomi won more customers. The manufacturer’s business has learned from this but has had problems to restore the margins to 10%, which the executives promised the investors to achieve. Lowering the prices down of its cellphones will not help it but will lead to a loss instead. Therefore, it has reported 9% margins in its third quarter this year and not made any comments.
Samsung’s stock closed at $1,050.00 on October 15.