Market value of Samsung decreases by $10 billion in July 2015
Stocks of world’s biggest smartphone maker Samsung declined by 6.6% in the past month, July. This amounted to a loss of $10 billion in the market value of Samsung. Yes !! A whopping $10 billion. This amount is twice the capitalization of LG Electronics. In the 2nd quarter, shares of Samsung fell more than 3%.
The cause of this drop is the slow sales of Galaxy S6 models. While Samsung couldn’t produce enough 3 sided screens for the Galaxy Edge model, regular Galaxy S6 model too faced tough competition from Apple. Then increasing competition from Chinese vendors like Xiaomi, continuous increasing sales of iPhones added to the cause. Overall Samsung has dropped 11% this year. That is alarming for Samsung!
However, there is a rise in profit from Samsung’s semiconductor business. It makes memory chips and processors. But to encounter the loss in smartphone division a price drop in Galaxy S6 and Galaxy Edge models is expected. This is just after 4 months after the launch. In addition, Samsung would also like to target the mid-range smartphone market in a better way. Also, next Note device will also be revealed this month only on 13th, August.This is earlier than usual schedule. But to encounter the market loss Samsung needs to take some steps and this might be one of them. As the competition will get tough only in upcoming quarters.
Recently Samsung launched two 4G smartphones in India to capture the 4G market. That was a good move by Samsung as both are good phones and priced well too. You can see the specifications and pricing here. Also, have a look at specifications that other manufacturers like Motorola, Sony are providing in the same range as Galaxy Edge Here. The competition is indeed tough and quick measures are needed from Samsung.