Galaxy s6 edge

Surging iPhone demand on the high-end and plummeting sales of its feature phones that are getting squeezed out of the market by Chinese upstarts like Xiaomi are largely blamed for yet another disappointing quarterly earnings that Samsung posted Thursday.

The South Korean conglomerate reported an eight percent annual decline as profits decreased to 5.75 trillion Korean won, or approximately $4.9 billion, from 6.3 trillion won a year earlier. Analysts predicted 5.6 trillion won of net income. The results mark a fifth straight drop in quarterly earnings for the consumer electronics giant.

The bad news gets worse as Samsung’s mobile division, its bread and butter, reported a huge 37.6 percent drop in mobile operating income which fell from 4.42 trillion won in 2014 to 2.76 trillion won during the April-June period.

Total sales for the quarter dropped seven percent on an annual basis, from 52.35 trillion won in the second quarter of 2014 down to 48.5 trillion won today.

Operating income dropped four percent to 6.9 trillion won. The mobile division’s operating profit margin came in at 10.6 percent, down sharply from 15.5 percent in the year-ago quarter. That’s because average selling price of Samsung handsets decreased as the company responded to competition in China by lowering prices of its feature phones and low-end smartphones.

Samsung 2015Q2  earnings image 001

The company has acknowledged that its Galaxy S6 and Galaxy S6 Edge devices have failed to reverse the profit decline, admitting on a conference call with investors that “Total sales of the S6 and S6 Edge during the second quarter were below expectations.”

Samsung 2015Q2  earnings image 002

The impact of the launch of the Galaxy S6 and Galaxy S6 Edge was “quite marginal due to low smartphone shipments and an increase in marketing expenses for new product launches,” the company conceded.

The management will continue to “innovate the hardware to lead the market in the premium segment” while continuing “to add services.” Samsung was mostly hurt by misjudging demand for Galaxy S6 Edge.

According to the Wall Street Journal and Bloomberg, the Galaxy S6 Edge has turned out much popular than Samsung has anticipated, with demand closer to one to one between the regular S6 and the S6 Edge, which costs more and has a curved screen.

“The only people buying a high-end Android phone want the top-of-the-line, and that means the Edge. Anyone who is concerned about price isn’t going to save $100 by buying a normal S6; they’re going to save $500 and get a perfectly serviceable phone that runs the exact same software,” observed blogger Ben Thompson in his Daily Update email blast earlier this month.

Samsung Galaxy S6 Edge bottom 001

Samsung’s internal estimates assumed demand for the devices would be around four to one in favor of the regular S6, resulting in shortages of the S6 Edge and unsold stock of the regular S6.

Samsung does not divulge mobile unit sales for competitive reasons, but research firm Strategy Analytics estimated that Samsung’s worldwide share, which includes all handsets, fell from 22.3 to 20.5 percent in the June quarter as shipments declined from 95.3 million to 89 million units.

iPhone 6 gray silver gold back camera

During the same period, iPhone sales grew 35 percent year-over-year to 47.5 million units thanks to the runaway success of the larger-screened iPhone 6, earning the California firm a 10.9 percent marketshare of mobile operating systems and pushing it to the second place.

“Apple outperformed as consumers in China and elsewhere upgraded to bigger-screen iPhone 6 and 6 Plus models,” said the research firm in its analysis.

Microsoft dropped to fourth place as total shipments decreased from 50.3 million in the year-ago quarter to 27.8 million, leaving it with just 6.4 percent of the market for mobile operating systems.

Strategy Analytics mobile OS share 2015Q2

Microsoft earlier reported a $7.6 billion write-down for its handset business, plus restructuring charges between $750 million and $850 million. Its Lumia smartphone family is currently in the state of flux as the firm transitions to Windows 10, with new Lumias powered by Windows 10 not expected until later this year.

Huawei sold 30.6 million handset units, overtaking Microsoft to become the world’s third largest mobile phone vendor for the first time ever. Chinese upstart Xiaomi increased its share from 3.5 percent a year ago to 4.6 percent today, earning it fifth place, according to Strategy Analytics data.

The data also indicates that global handset shipments grew just two percent annually, the industry’s weakest performance for two years due to slowing demand for handsets in China, Europe and the United States. Smartphones accounted for eight in ten of total mobile phone shipments during the quarter.

IDC data corroborates most of Strategy Analytics’s findings, painting Samsung as the only top five smartphone vendor to have lost market share in the June quarter.

SamsungTeaser_2015-07-21

Feeling the heat, Samsung has reportedly decided to unveil the fifth-generation Galaxy Note phablet alongside an even larger version of the Galaxy S6 Edge at a media event on August 13 in New York City, three weeks in advance of its usual launch timeframe.

The invite for Samsung’s Unpacked 2015 event can be seen above.

What do you think, will the new Note 5 along with the next Galaxy smartphone stanch the bleeding and help Samsung turn things around?

Source: Samsung

  • Vic O

    And let the Apple hate begin…

  • Mr_Coldharbour

    So much for being the so-called “iPhone-killer.” You know, every time I read such nonsensical headlines on “XYZ” device being the “iPhone-killer” I simply chuckle, unwillingly. Though, the upside to Shamesung’s predicament is that they now have more room for economic growth. It doesn’t take an econ/finance genius to discern the fact that if your profits have been plummeting and have therefore reached a new minimum, the slightest positive change in sales volume could translate to high [percentage] growth (something analysts care about the most and will thus try to move stock in favour of that company yielding in potentially surging stock prices for that company). That aside, Shamesung will always be Shamesung and Apple will always be Apple, and Shamesung can’t be an Apple. A similar comparison could be a Bentley or Rolls Royce will always be a Bentley or Rolls Royce, and a Hyundai can’t be a Bentley or Rolls Royce.

    • Ali Mughal

      TL:DR Samsung should learn from their mistakes.

      • Bugs Bunnay

        Learning from mistakes are not in their vocabulary.

    • Vic O

      HEAR! HEAR!! If I had Samsung CEO’s email address, I’d forward your write up to him. Maybe they’ll finally think in the right direction.

  • Om

    “…4.42 trillion won in 2014 to 2.76 trillion won during the April-June period”.

    This should say “… 4.42 trillion won in *the second quarter of* 2014 to 2.76 trillion won during the April-June period”.

  • Bugs Bunnay

    Not even news for samsung. Love the samsung iphone s6 edge though.

  • leart

    here’s a add in my country..

    it says:

    light your creativity

    designed to inspire, inspired to design….

    now is not only spamsung copying apple that’s why they are not selling that much anymore…

  • Dante Arellano

    no worry samesung and androide you still have half of the world that is too ignorant and poor to buy an iphone say good bye to the another half that you called ignorants on your ads they never going to but another shitty cell phone for u samesung

    • Micrones

      Such an ignorant statement….
      Seems there is a bunch of schoolboys commenting today

    • Cesar D

      and i like potatoes

  • iPhoneWINS

    cause android sucks

    • anustart

      Android doesn’t suck. Some of the phones do, but not Android. I like the aesthetics of Android L and M quite a lot. Material Design is awesome IMO.

      • Матт Реякіпѕ

        Android def does suck. Where to begin. It’s got far more vulnerabilities than any other mobile OS and not because it’s most used (which is the excuse all Android users use). Truth is Android had more vulnerabilities than iOS before it had more users than iOS. This recent vulnerability can affect up to 95% of all Android users, and less than half the Android users will ever get that security fix. Let’s see outside of vulnerabilities, you have huge fragmentation where more than half the Android users are on KitKatt or earlier (in comparison 80% of iOS users are on iOS 8 and all on iOS 8 will get iOS 9). There’s also the difference of quality between Android and iOS apps and games. If you’ve had both Android and iOS like I have you would know how inferior the Android versions are. So really if specs and cost doesn’t matter to you, there really isn’t an advantage to Android unless you’re one of those cheap people who choose to download cracked apps and games instead of paying for them.

      • Mr. Right

        Can I see where you got all these stats from?

        There’s no advantage to android? Have you owned a android phone before? You don’t have to connect your iPhone to iTunes every time you want to add a song, picture, video, and etc.

        Root an android device and see what more it can do. Even if the company like Samsung stops sending out updates for your phone you can boot the latest android on to your phone or even use another phones OS on yours.

        You say there is security problems but barely anyone has them. Plus you have to be smart to understand what is safe and what isn’t before you download something.

        “Unless you’re one of those cheap people who choose to download cracked apps and games instead of paying for them.” People do the same shit on iPhones. Ever heard about jailbreak?

      • One thing Android does have going for it (which Android users often tout) is that it doesn’t have Apples walled garden. The AppStore is great but at the same time it’s both a blessing and a curse. It’s true that it helps to keep out malware but it also enforces strict rules and regulations. Apps like Kodi aren’t allowed in and developers can’t create an alternative web browser that doesn’t use the Safari rendering engine.

      • Micrones

        i agree with you , i can do so much with Android that is so not possible with IOS. Android is getting better and quite polished with all the launchers etc that makes it so customisable.
        A lot of commenters have barely used an Android device before reacting , typical apple fanboys
        Being enlightened about competition is a virtue of a well informed mind

      • Everett Clark Davis

        Chrome and Safari both use the same rendering engine, Webkit. Websites will look the same in safari as they do in chrome. Webkit is open source

      • This was exactly the point I was trying to make. If Apple wasn’t so strict Chrome would be using the Blink rendering engine instead and the V8 engine for JavaScript however Apple does not allow alternative rendering engines to be used in AppStore apps. It’s the Safari engine or nothing.

      • Micrones

        The funniest thing about the love hate relationship between Android and IOS is funny, the fact remains that majority of the tech community and i mean the serious ones either use an Android device or carry both an Android device and an iphone. Most of them are device agnostic.
        Android of the Jelly Bean era isnt the same of the present lollipop . Granted that each OS has its quirks. Android is more polished than what it used to be.

        I use both devices and know that Android Lollipop is a beauty to use just as IOS.

        The way Android handles tasks is akin to using a computer a-times, granted that no OS is perfect, i think you should use one instead of being blindly ignorant

    • Cristian B

      Android definitely doesn’t suck. It’s really good when you pick a good phone.

      • Матт Реякіпѕ

        Wow what a terrible comment. Android is an OS, the type of phone doesn’t determine the OS itself. You wanna true test of how good Android is? Get an Android phone with similar specs as the iPhone 6 and then see how slow Android is. Hell Android is so bad that the iPhone 6 with such low specs killed the S6 in gaming benchmarks. Had the S6 had iOS instead of Android, the S6 wouldve destroyed the iPhone 6 in gaming benchmarks.

      • Cristian B

        I have to respectfully disagree, not what you said about android being overall bad, but the fact that android differ to what phone you get. Especially Samsung with their touchwiz, I really do hate it.

      • Micrones

        Well stated

      • Mr. Right

        Have you seen the multi-core benchmark? When gaming it uses the multi-core instead of the single core.

      • The most important thing regarding gaming is the GPU. The CPU doesn’t really matter as long as it’s relatively powerful.

  • Micrones

    Funny how typical commenters on idownloadblog sounds childish and ignorant, because samsung is doing woefully does not mean Android is a bad platform nor is it meant for less fortunate people.
    There are people that are diehard Android fans simply because of the level of customisation possible which you wont get on iphone unless you jailbreak
    I switch between an iphone 6 plus and a nexus 6 and i like both platforms for their strengths and weaknesses but for most commenters here the ignorance and hate for Android is so blatant and open.
    Such a shame when they havent even tried that Android from Kitkat onwards

    • anustart

      Exactly. I agree with you. They don’t understand anything about Android most of the time, so when they see Touchwiz on an S6, they think the phone is stuck looking like that. However, you can grab the Material theme in the Theme Store and Nova Launcher/Google Now Launcher or any other launchers and basically get rid of Touchwiz entirely. Even then most Android haters don’t realize what Lollipop is or the difference between it and KitKat since most OEMs skin Android on their phones.

      • Матт Реякіпѕ

        Until you’ve owned an iDevice, you are not in a position to pass judgment on others. You know dirt would taste good to anyone who has never eaten anything else. Android users just need to stop commenting. Only Android users who have a right to comment have owned an iDevice before AND have done research on both iOS and Android. U didnt even know about the new vulnerability in Android yet you tell others they don’t know about Android? You don’t even know much about Android.

      • anustart

        So ignorant… I have an iPhone 5, 6 plus, and I’m purchasing a Galaxy S6 since I just sold my S5 (which I’ve used since it came out).

        If you like iOS, good for you. People like Android too, myself included. But I by no means hate iOS (typing on my 6+). If you don’t like something, just leave the people alone who do! Is that so hard? No one gives a shit that you don’t like what they do. They didn’t wake up to impress you, and you hating on their interests or preferences makes them even more reluctant to jump platforms if they were considering it…

      • Cristian B

        I don’t freakin get why their has to be assholes like this who just reign iOS superior and just completely shard turds on android. And I use and love both.

      • anustart

        And until you know me and what research I’ve done, you are in no position to pass judgement on others. If you’re so hellbent on forcing this “Android sucks because of a new vulnerability” onto people, tell me what vulnerability that is. Link the articles or websites where you read this. I’m interested.

    • Матт Реякіпѕ

      Most Android users have never had an iDevice yet for some reason they assume they can compare the 2 operating systems. Only people who really know which OS is better have had both. And it’s pretty safe bet every Android user commenting on here, has never owned an iDevice in their life. yeah if you’ve never owned an iDevice, you wouldn’t know how terrible Android really is. There’s a reason more flock to iOS from Android than iOS to Android. And why most who switch from iOS to Android go back to iOS but most who switch from Android to iOS, stay with iOS. It’s because iOS is a better OS to those who have used both.

      • Ronald Ramsay II

        I have to agree here. I was a die-hard Android user. Hell I use to develop for Android my most recent phone being the Nexus 6. Check my name on XDA:itsmikeramsay.

        Anyways I’m using an iPhone 6 Plus and thought when I first switched of be going back. I’m still using my iPhone 6 Plus, albeit yes it’s jail broken but I love it far more than any rooted phone. Here’s why:

        For an 8 megapixel camera I work FAR less to get better shots than any Android phone I’ve had. I had from the S3 up to the Note 3 then the Nexus 6. Performance on just 1GB of RAM is astounding although I can’t wait till the 6S for 2GB of RAM. I love how optimized iOS is and the fact that it’s always consistent. People think 4GB of RAM and Snap810 or Snap820 will kill an IPhone. Hardware wise yes, but couple it with Android and it changes everything. Android is so far unoptimized it annoyed me.

        For those that don’t know. Android is a VM that runs on top of Linux on a smartphone. Hence the reason why 4GB and these high clocked processors are needed. Ever wonder why fastboot is needed on some Android devices? There you go. iOS runs directly. It’s optimized. Which is why it needs half the hardware of these top Android phones to be better than the best Android has to offer.

        What people don’t see or choose to overlook is if Samsung released 2 phones a year like Apple does they could NOT keep up. Which is why they release 4 flagships and nowadays total of 5 flagships this year, coming next month. Let’s not forget about all the other mid range and low end devices as well.

    • Dante Arellano

      Hell yes! Andoide is super cool everyone has one in the movies everyone has an androide even the president of north corea has one will should kill any another technology or os like windows androide should take control over the world cus androide is the best thing could happened to this world i cant wait for the movie androide the best thing of the world”

      • Micrones

        So i think owning an iphone makes you super cool and proud of yourself , isnt it?

      • Dante Arellano

        No really i feel shame of use iphone 6 plus i which have anadroide phone those are the best thing in the intire world

  • iDude

    god! look at that screen its a sick end-to-end display. i think samsung needs to create a front-to-back display for them to par with apple. 😀

  • Alberto Espinal

    They will never kill the king! It doesn’t matter who it is, one plus 2, Nexus, HTC, you always going to be second!

    • Cristian B

      Coming from a iPhone user, F**k you. This is exactly why people give apple fans a bad name. Because of people like you.

      • Alberto Espinal

        Waaoo take a chill pill buddy, lol, how old are you? 10? I’m cracking here in my House after your comment!!

      • Mike

        People need to learn that phone sales isn’t going to make your phone any better. If I’m buying a phone I don’t look sales… I look at what it offers.

        That being said the iPhone isn’t the “king” everything it offers has be there for a while now. Samsung has much more to offer than the iPhone.

      • Alberto Espinal

        You see Mr. Mike gave me a good respond! But I personally prefer the iPhone, it takes great photography, it never freezes on me, i use Pay a lot, I’m constantly switching from my iPhone to my MacBook for emails because of my business and continuity its god sent, you see i use my phone for purpose!

      • Mr. Right

        iMessage is the only good thing on iPhone right now to me. Samsung has a better payment system where it uses magnetic strips and I’ve never seen one freeze. My current phone iPhone 5s jailbroken freezes and boots into safe mode at least 3 times a day and iPhones that aren’t jailbroken are plain boring.

      • Rowan09

        Good one. No sales means the phone is useless not to every since some people even own the Blackberry Passport device. If people don’t purchase a device the company is forced to stop making the device and so sales is the most important thing then hardware and features to any company.

      • Mr. Right

        Even if the company stops making the phone you still have one badass phone. What happens to the company before and after shouldn’t matter when buying a phone. Thats the companies problem not yours.

      • Rowan09

        Of course it’s a customers problem as well because that would mean no more of that device or support.

  • askep3

    The only people buying a high-end Android phone want the top-of-the-line, and that means the Edge. Anyone who is concerned about price isn’t going to save $100 by buying a normal S6; they’re going to save $500 and get a perfectly serviceable phone that runs the exact same software,” observed blogger Ben Thompson in his Daily Update email blast earlier this month.”

    I kind of felt the same on the iPhone 5c when I came out, I understand that there isn’t an iOS device that’s $500 cheaper (not count mint the iPod touch since it isn’t a phone) but I still don’t see why people would want a 5c its only $100 cheaper and has hardware from the year before except a plastic cover.

  • Cameron

    What would you do, if it all came back to you?

  • Матт Реякіпѕ

    Android users who have commented or are considering commenting that have never owned an iDevice, I recommend doing research first. You can start with the new vulnerability that can affect 950 million android phone users (50% of those devices will never get a security patch), then you can follow that and see how fragmented Android is in comparison to iOS (75% of Android users are on KittKat or older where as 80% of iOS users are on iOS 8). After that you can look up the difference in quality of apps/games on both (iOS is so much better that Android users who switched from iOS say the thing they miss most about iOS is the quality of apps and games). You do all this research, i guarantee you that you don’t go back here saying Android is a great OS. Unless u like to lie and are in total denial. I left Android for iPhone once iPhone 5 came out, will never go back to Android. May switch to Windows Phone one day if it ever improves. But until that time it’s iOS. For security benefits and quality alone

    • Micrones

      The funniest thing is 10 years from now , we will be talking of how great a new and phone manufacturer is
      In case anyone hasnt been following the tech world for decades, The next best phone maker/OS is on the horizon,
      At some point Blackberry was the best, just as Nokia ruled the world but where are they now….. its all a cycle

  • port87

    cruising on 1 infinite loop with my woes.

  • Rowan09

    Samsung has been digging it’s own grave and doesn’t know how to get out of it. I’ve said it plenty times before they were always competing with themselves releasing 5-10 devices every year. If someone just bought a S6 Edge and now they are releasing an S6 Note type device, then they are release the Note 5 and Note Edge. Customers are confused and see no reason to upgrade as often since they release so many devices. They need to trim down their line and start from there. Personally I think you should either do the Note Series alone (since every phone is typically now a phablet) or the Galaxy S Series alone.

  • Lucas Jackson

    i bought an android once, i rooted it thinking it was gonna just as cool as jailbreaking, well guess what, i ended up returning it the next day. the root tool displayed ads and it wasn’t even close to jailbreaking. i prefer the iOS operating system over android, also i prefer cydia/jailbreaking over rooting, android sucks

    • Mr. Right

      You basically opened the box (rooted) looked at the smaller boxes (root tools) didn’t know what to do with them so you returned it phone without opening those smaller boxes.

      The reason you like cydia better is because its so locked that even small tweaks make it exciting while android already has all those tweaks.

    • Micrones

      Obviously you shouldnt be rooting as you seem ignorant about it, i use a jailbroken iphone 6 plus and rooted nexus 6, i have rooted so many androids easily and successfully without issues.
      Stick to an iphone , tis a no brainer to jailbreak one

  • Franklin Richards

    How do you expect Samsung to thrive? Now that Apple has not shown much stride in innovations they have to come up with their own stuff.