Capitalization Samsung decreased by $ 17 billion due to poor sales of Galaxy S6 – RBC

Smartphone Galaxy S6

Photo: REUTERS 2015

On Friday, July 31, Samsung’s market capitalization was about $ 150.2 billion. In this June 30, 2015 it was $ 167.1 billion. For comparison, the capitalization of local competitor – LG Electronics is $ 5 , 7 billion.

Reducing the cost of the company’s shares occurred after the largest by the number of smartphones sold maker posted a fifth straight quarterly report on the decline in profits.

In the last financial report also it warned of slowing market growth of devices and the “cooling” in demand for microchips. The share of Samsung smartphones in the world fell by more than 3 percentage points in the second quarter of 2015 amid rising sales of Apple’s iPhone and stiff competition from Chinese manufacturers, including Xiaomi Corp., the agency reported.

In addition, less than four months after the official release of its high-end devices, Samsung has lowered the prices for them. It was assumed that the day of the start of sales of the flagship models of the company Russia’s cost devices will start from 53 990 rub. for the model Galaxy S6 (32 GB one SIM card). However, on the day of the start of sales (April 16) due to the strengthening of the ruble retailers to sell this model from 46 990 rub.

The company has also made a mistake with the forecast of sales model Galaxy S6, which enjoyed a small demand, in contrast to the flagship models of iPhone and iPhone 6 6 Plus. At the same time Samsung has not released sufficient model Galaxy S6 Edge with rounded display, which has become popular. The South Korean company has introduced two models of March 1, 2013.

Seoul analyst research firm Quad Investment Management Co. Marcello Ahn said that Samsung is not worthy of an answer competitors’ products, and he doubts that this situation will change in the coming year. This means that investors have become less reason highly of the paper company, Ahn said.

According to the agency, with the beginning of the year Samsung shares fell 11%, which is the strongest decline since the global financial crisis. In the accounts of the company more than $ 43 billion of funds, according to Bloomberg.