Samsung's worth cuts for top-finish telephones labored, however harm income

Samsung's price cuts for high-end phones worked, but hurt profits

First, the excellent news for Samsung: it made extra money within the third quarter (because it predicted) than it did in the identical interval final yr. In 2015 it racked up $6.forty six billion in working revenue for Q3, which is much better than 2014’s $three.eight billion haul, however nonetheless not again to 2013’s peak of $9.6 billion. It made round $three.eight billion in Q3 final yr, and this yr it is again as much as $6.forty six billion. In its detailed launch in the present day (PDF), Samsung confirmed brisk gross sales of latest flagships just like the Galaxy Word 5 and Galaxy 6 Edge+ however worth reductions on the brand new S6 fashions and extra gross sales of midrange telephones.

Samsung's price cuts for high-end phones worked, but hurt profits

Accordingly, Samsung is seemingly specializing in “sustaining” these outcomes greater than getting again to its earlier excessive. In 2016, it figures the expansion price for telephone gross sales will proceed to decelerate, so anticipate to see fewer fashions launched because it streamlines the lineup. In fact, as all the time, it is planning on pumping up TV gross sales with greater and higher fashions, and pushing new wearables to go together with its telephones. Because it stands, probably the most fascinating spot in Samsung’s plans for subsequent yr could possibly be the clear and mirror show tech it plans to roll out to be used in cars and head-mounted shows, so hold an eye fixed out for that at CES in January.

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