The financial report is expected: the mobile phone continues to decline, the chip remains fierce, and a technology giant that is distorted is presented to the people.
Due to the growth of non-consumer businesses such as chips, the earnings report seems to be peaceful and even dynamic. However, Samsung's mobile business revenue fell 20% in the quarter, only 24 trillion won (21.4 billion US dollars). It cannot be said that Samsung has not been able to reverse the situation in the mobile business after adjusting for the two quarters of this year. Even from the figures of Q2, Samsung is struggling in the mobile business, I believe this is high for Samsung. In the case of employees or employees, they are unwilling to accept the facts.
The market is so cruel, when the mobile phone became Samsung's 'side business', Samsung, which has always been rhythm in the rapid growth of smartphones in the past few years, has been unable to stop the decline in the mobile business. Looking around, it is difficult to see the turn. sign.
The chip is fierce: the mobile phone has become Samsung's 'side business'
For the decline of the mobile business, Samsung explained: The sales of the flagship mobile phone Galaxy S9 series continued to be sluggish. In this regard, Samsung also warned investors that 'price competition and new product release may cause the market environment in the second half of the year to continue to face challenges. . '
In other words, the profit growth of the entire Q2 Samsung mobile business has reached its lowest level in the past year. But this is not complete. As the price competition of friends and new products continue to be released, the Samsung mobile business is expected to be more "pessimistic".
One of the variables for Samsung Mobile in the second half of the year is that Galaxy Note 9 will be released in New York on August 9. As Samsung's flagship in the second half of this year, can this new machine regain a game for Samsung? I am afraid that even Samsung itself No confidence.
From the information leaked out, the appearance of Note 9 has no qualitative leap compared with Note 8. The smartphones of Youshang are innovative, including OPPO, vivo lift camera, Huawei P series, Leica, etc. Compared with friends, Note 9 is still played according to Samsung's 'old-fashion' style of play, naturally it is difficult to achieve breakthrough transcendence.
From the current financial data, the non-consumer business such as chips is developing rapidly, and the mobile business has become Samsung's 'side business'. This seems to be undergoing 'distorting' for Samsung, which has been deeply involved in mobile phones and home appliances for many years. Process, the entire center of gravity is pressed on one leg.
Let's take a look at how successful the chip business is. In the past two years, Samsung's overall business growth has turned to non-consumer businesses such as chips. In the first quarter of 2016, Samsung's chip revenue accounted for only Intel's more than 30%, and the profit is also worse than Apple's more than one stall. And in the first quarter of 2017, Samsung's chip revenue has been comparable to Intel. In the second quarter of 2017, Samsung Semiconductor revenue More than Intel's billion US dollars, officially become the world's largest chip maker.
In Q1 this year, Samsung Semiconductor's sales were US$18.607 billion, up 45.4% year-on-year, 1.6% quarter-on-quarter, and market share reached 16.1%. Compared with Intel's revenue, it was US$15.745 billion, up 11.1% year-on-year. %.
From the Q2 data just released, Intel's revenue for the quarter was 16.962 billion US dollars, up 15% year-on-year, net profit was 5.006 billion US dollars, up 78% year-on-year. Samsung's semiconductor business revenue reached 20.78 trillion in this quarter. The South Korean won ($19.25 billion) has an operating profit of 11.55 trillion won (about $10.7 billion).
It is not difficult to see that Samsung, which became the world's largest chip maker last year, has maintained strong growth in the chip business, which is in stark contrast to the continuous decline of the mobile business.
Weakness in innovation: markets such as China and India have been hit hard
According to Strategy Analytics, Samsung’s market share in China was only 2.1% in 2017. In the fourth quarter of 2017, Samsung’s share of the Chinese smartphone market was only 0.8%, compared with Samsung’s presence in China five years ago. The market share has been as high as 20% compared to one in the world.
On March 25 this year, DJ Koh, head of Samsung's mobile division, apologized to shareholders for the decline in China's market share at the company's annual shareholder meeting. He said: 'China is a complex market, and Samsung is now trying different ways to attract this. A new customer in the market. '
More than the Chinese market. In India and other major overseas markets, Samsung's mobile phone business is also moving forward, even to the gap between Apple and Huami OV is difficult to 'freely stretch'. As reported by Counterpoint, this year's report In the first quarter, Xiaomi's share of the smartphone market in India reached a record 31%, surpassing Samsung's first share. Samsung's share fell to 26%. At the same time, Vivo, OPPO share was 5.8%, 5.6%, occupying the third place. Fourth place; glory entered the top five for the first time, with a share of 3%.
Recently, Samsung began to exert its strength in the Indian market, hoping to regain some market share. However, in the cracks of Chinese manufacturers, this wish seems to be wishful thinking. Previously, Samsung was also a substitution in the process of China's defeat. , several counterattacks, the result is getting worse.
Since the battery door incident, Samsung’s vitality has been difficult to recover. With China and India, these important markets have been hit hard. It is believed that Samsung will not be able to turn over in the future. It is especially important to note that it is not only in front of Samsung. China, India and other markets are defeated. The core problem is that product innovation can't keep up, and there is no new product that makes people feel uneasy.
Indeed, Samsung is the whole industry chain manufacturers have the ability rare in the mobile phone industry, but this advantage and failed to focus on empowerment, whether it is in the first half of this year's flagship S9, or the upcoming release of new mobile phones in Samsung's Note 9, There is a lack of differentiated breakthroughs, which can not surpass their predecessor models, and can not be compared with the innovative products of friends. Such Samsung mobile phones can hardly remain in the current fierce competition even without the shadow of the battery door. increase.
This is like the HTC of the year. In the early days of smart phones, it became the leader of the market. Later, the competition of smart phones became more and more fierce, and the innovation of HTC could not keep up with the use of the sea tactics. Later, because of the ban on Apple's patent lawsuit HTC in North America and other regions, this became the fuse of the collapse of HTC's mobile phone business. The rise and fall of the HTC, the lack of innovation is the root cause, the patent lawsuit is only a fuse.
Today's Samsung is the same, it seems to be a 'battery door' after a lack of vibration, but the 'battery door' is just a fuse, the fundamental problem is that Samsung mobile phone innovation is weak, has not been eye-catching products, S series and Note series released new products Just like the doll, there is no interest in the user's change of machine. At the same time, while Samsung is stagnating, the friends are running too fast, not to mention Huawei, which has the highest investment in global R&D, even OPPO and vivo for marketing. Manufacturers who are well-known, nowadays can use innovative technology to lead the new product trend - this makes the Samsung with the advantage of the entire industry chain feel embarrassed!
Distortion: The drawbacks of chip, mobile phone business imbalance
As a comprehensive electronics group, Samsung is a healthy place for both balanced computing and mobile phones. Nowadays, because of the sluggish business of mobile phones and other businesses, it is not Samsung's original intention to reverse the business of the chip business. In the meantime, Samsung Electronics, which we have known before, is distorted and the business is beginning to be out of balance.
Samsung became the world's highest-paid semiconductor company last year, surpassing the long-term leader in the market, Intel. This is undoubtedly a positive for Samsung's investors, but for Samsung itself, it is still quite ironic. Samsung's genes are not only chips, but also consumer electronics such as mobile phones and home appliances.
Nowadays, relying solely on chips to support the facade, it is inevitable that people will sweat for Samsung. Although the All in chip is also hungry, this is not the result that Samsung Electronics wants to present.
If you look closely at Samsung's chip business, it may not be as optimistic as it seems. Samsung Q2 storage chip business revenue increased by 33% to 18.5 trillion won ($16.5 billion). Its overall semiconductor business revenue growth of 25 %, reaching 21.99 trillion won ($19.6 billion). But the unexpected growth of Samsung chips is not only how leading Samsung’s chip technology is, but the rapid rise in DRAM and NAND flash prices over the past year. .
As we all know, NAND Flash and DRAM are the more common technologies in memory chips, and Samsung is the leader in the DRAM and NAND markets. In other words, Samsung's chip business is also enjoying the dividend of rising prices. Reuters has previously revealed that Samsung For every dollar of DRAM chips sold, you will earn 70 cents in operating profit.
Conservatively, if there is no such environment in which the market price of the chip is soaring, Samsung, which has lost the advantage of the mobile phone business, is actually not optimistic.
Overall, non-consumer services such as chips account for the bulk of Samsung's original intention. I believe that Samsung is rather slow in the chip business, and is not willing to have problems with its mobile phone business. However, the market will not be transferred by Samsung's will.
Next, Samsung is bound to continue to seek recovery opportunities in the mobile phone business, but consumers will not give Samsung such a 'refusal period'. After all, both Apple and Huami OV are good substitutes, who will be The era of mobile phones has become a fast-moving consumer goods to wait for a new product that does not have much imagination space?