Smartphone maker Samsung Electronics’ Q3 profit plunges by 60 percent.
Slowing smartphone sales have led Samsung Electronics to clock a quarterly profit said to be the lowest in three years. Preliminary estimates by the South-Korean giant reflect that the operating profit has fallen by 60 percent to $3.8 billion in the third quarter of 2014, its worst since 2011, the company announced on October 30, 2014.
In 2014 alone, Samsungs has lost nearly 20 percent of its share value. The company’s smartphone division has been fluctuating in maintaining market leadership against its persistent rivals Apple and newcomer Xiaomi, who have been releasing a slew of their highly anticipated phone models.
The firm’s flagship line of smartphones, Galaxy, has been losing market share to Chinese smartphone-makers Lenovo and Xiaomi, which are giving the brand fierce competition in terms of cost, display and multiple features. The company has stated that that market competition will only rise from here on.
The company is currently uncertain about the growth in profits, even though there has been a growth in demand for the recently released Galaxy Note 4 and new middle-end smartphones. However, it is hopeful that the average selling prices for handsets will rise in the fourth quarter, as there is a rise in demand in the holiday shopping season.
Samsung has indicated that there may be a potential increase in marketing expenses associated with year-end promotions, as more competition emerges. The company has pledged a revamp of its mid-to-low range device line-up to revive price competitiveness and use of higher-quality components to distinguish its devices from others
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