Sunday, Sep 21, 2014Sunday, Sep 21, 2014
 

Samsung Electronics braces for weakest year of smartphone growth

Published on Jan 7, 2014 6:04 AM
 
Samsung Electronics' Galaxy S4 (left) and Apple's iPhone 5 are seen in this file picture illustration taken in Seoul on May 13, 2013. Samsung Electronics Co Ltd is bracing for its weakest smartphone profit growth this year since 2007 as arch rival Apple Inc challenges its domination in China's US$80 billion (S$101 billion) market. -- PHOTO: REUTERS

SEOUL (REUTERS) - Samsung Electronics Co Ltd is bracing for its weakest smartphone profit growth this year since 2007 as arch rival Apple Inc challenges its domination in China's US$80 billion (S$101 billion) market.

Samsung's mobile devices business, which earns two thirds of the company's profit, will come under pressure when Apple makes its phones available from Jan 17 via China Mobile Ltd , through which Samsung has been selling smartphones for around seven years.

Apple is also widely expected to sell smartphones with larger screens come autumn when it traditionally announces products, neutralising a selling point that Samsung has enjoyed since introducing its Galaxy Note in late 2011.

"Profit decline in mobiles will be inevitable, as the majority of growth will come from cheaper, low-margin phones, while competition at the high end will get only tougher with Apple's iPhone deal in China," said Shinhan Investment analyst Kim Young Chan.

 
If you are not a subscriber, you can get instant, unlimited access here