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Samsung’s Earnings, Smartphone Market Share, and Galaxy Fold

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Samsung’s (OTCMKTS:SSNLF) earnings report for the fourth quarter and fiscal 2019 revealed continued weakness in the company’s semiconductor business. Here’s the company’s earnings report at a glance and more.

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What Samsung’s earnings reveal

Samsung reported its fourth quarter and fiscal 2019 earnings on January 29. The revenue increased 1.1% YoY (year-over-year) to 59.9 trillion won ($50 billion) in the fourth quarter. However, the net profit fell by 39% YoY to $4.4 billion.

For fiscal 2019, Samsung reported revenue of about $190 billion, which decreased from $200 billion in 2018. The profit for 2019 was about $18 billion—down from $34 billion in the previous year.

Samsung’s earnings for the fourth quarter and fiscal 2019 suffered from weaknesses in the company’s display and memory chips markets. However, the company sees improvements in these businesses in 2020.

World’s top smartphone company

Samsung’s earnings report coincided with the release of smartphone sales estimates. According to Strategy Analytics estimates, Samsung shipped over 295 million smartphones in 2019, which resulted in a 20.9% market share. With that, the company maintained its position as the world’s top smartphone company. Counterpoint and Canalys’ estimates also placed Samsung on top.

However, in the fourth quarter, these industry trackers estimate that Apple beat Samsung in terms of smartphone unit shipments and market share. Strategy Analytics estimates that Apple took a 18.9% share of the global smartphone market in the fourth quarter compared to Samsung’s 18.4%. Canalys estimates that Apple captured a 21.3% share of the smartphone market in that quarter, which beat Samsung at 19.2%. Counterpoint estimates that Apple’s share of the smartphone market in the fourth quarter was 18% compared to Samsung’s 17%.

Foldable Galaxy model on the way

While Samsung’s semiconductor business struggled in the fourth quarter and fiscal 2019 due to weakness in the display and memory markets, the mobile business was a bright spot. The company’s earnings report shows that mobile business revenue rose 8.0% YoY in the fourth quarter and 6.0% in fiscal 2019.

To build on the strength in the mobile business, Samsung plans to unveil a new flagship smartphone model. Last year, Samsung entered a new smartphone category with the launch of its first foldable phone. The device, called “Galaxy Fold,” costs nearly $2,000. The company is working on a new model of the foldable Galaxy smartphone for release this year.

During Samsung’s earnings call, executives didn’t reveal exactly when the new foldable phone will arrive. However, the company has its Galaxy Unpacked event coming up on February 11. The company uses the event to unveil new devices.

As Samsung brings new high-end smartphone models to market, it also sees an opportunity in mid-range and low-range markets. Therefore, the company will continue to strengthen its mid-range and low-range smartphone lineup through innovation.

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