Samsung’s high-end smartphones sign the innovation it has in retailer for the remainder of its merchandise, analyst says

SINGAPORE — Samsung is because of launch its latest Galaxy smartphones on Thursday and these expensive units are anticipated to ship when it comes to income and margins, an analyst informed CNBC.

The South Korean tech big’s high-end flagship units are “trophy” merchandise that sign to the trade at massive the sort of innovation the corporate has in retailer for the remainder of its product line, Bryan Ma, vp for units analysis at Worldwide Knowledge Company stated.

Stories point out that Samsung might announce three smartphones for the Galaxy S sequence: S21, S21+ and S21 Extremely to succeed the corporate’s S20 units. The launch will probably be broadcast at 10 a.m. ET (11 p.m. HK/SIN) on Samsung’s web site.

“I believe there may be clearly some strain in the midst of the pandemic, each on models and on common promoting costs, however regardless of that, that is, in fact, nonetheless a flagship product that has its place within the trade,” Ma stated Thursday on CNBC’s “Squawk Field Asia.”

Usually, Samsung launches its Galaxy flagship units in February or March, near or through the Cell World Congress commerce present.

Ma stated one of many the reason why Samsung introduced ahead the launch to January is to capitalize on Huawei’s ongoing struggles by releasing a “product like this and seize as a lot of that chance as they’ll.”

Seizing market alternative

As a part of a broader commerce combat between Washington and Beijing, U.S. sanctions have crippled Huawei’s capacity to do enterprise. At one level final yr, the Chinese language agency had dethroned Samsung because the world’s prime smartphone maker however that triumph was short-lived and its share of the smartphone market shrank.

Whereas Samsung picked up among the market share final yr, Chinese language smartphone maker Xiaomi has stepped up its efforts in locations like Western Europe to fill within the hole left by Huawei by means of aggressive promotions and visibility efforts.

One of many huge issues that Samsung is betting on is foldables, which many of the remainder of the trade does not fairly have but. And Samsung’s already on its second, shifting into third technology merchandise now

That can also be possible one more reason why Samsung possible introduced ahead its launch occasion, in keeping with Ma. “As a lot as Xiaomi is thought for having lower-end merchandise, they’re additionally on the market saying, ‘Take a look at this flagship Mi 11 telephone with this excellent digital camera,’ and all that kind of stuff. That is the place Samsung mainly will get to get on stage and say, ‘Look, that is what we have right here as properly,'” he stated.

The maturity of the smartphone trade limits the sort of innovation that firms like Samsung can tout for his or her new technology of units. However the world’s largest smartphone maker is making in roads in a single space the place the remainder of the trade continues to be taking part in catch-up.

Betting on foldable smartphones

“Remember, one of many huge issues that Samsung is betting on is foldables, which many of the remainder of the trade does not fairly have but. And Samsung’s already on its second, shifting into third technology merchandise now,” Ma stated. He added that he expects a brand new foldable machine to possible be introduced within the second half of 2021.

Samsung’s president and head of cell communications enterprise, TM Roh, final yr stated in a weblog publish that the corporate will develop its portfolio of foldable smartphones, making these units “extra accessible to everybody.” That might probably sign foldable smartphones with a much less hefty price ticket than what Samsung at present has available on the market.

Nonetheless, Thursday’s smartphone launch is unlikely to maneuver the needle on Samsung’s inventory worth by a lot. That is as a result of the primary revenue driver for the corporate is its profitable semiconductor enterprise that sells reminiscence chips that are utilized in smartphones, laptops and information facilities.

“Nonetheless, this branded Samsung product division, notably once more on these high-end merchandise, are nonetheless very worthwhile for them and will proceed to ship in that sense,” Ma stated, referring to Samsung’s IT and cell communications enterprise.

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