The Korean electronics giant posts a 74 percent drop in its mobile business operating profits during the September period.

The drop in revenue and profit has accelerated since Q2 2014, with a quarter on quarter drop in revenue of 10.22%, and profit of 42.98%. Q3 revenue year on year is down 20.45%, and Q3 profit year on year is down 74%.

The issue for Samsung is how it’ll convince people to spend their money on the Galaxy Alpha instead of some seriously compelling competition. In the US, the Alpha is going directly up against the iPhone 6, which is about as tough a fight as you can imagine until you look at its pricing in Europe. The Galaxy Alpha costs as much as the Xperia Z3, which has a better camera, display, and battery while also being waterproof. And then there’s the Z3 Compact, which has all those things and costs less.

The company on Wednesday said that for its mobile business in 2015, it "will focus on enhancing product competitiveness for each price tier and solidify longer term business fundamentals, in order to secure sustained growth and profitability." It also reiterated plans to differentiate its smartphones through flexible displays and metal frames, and its "new product development strategy will focus on streamlined strategic models in each price category to enhance product and cost competitiveness."

Samsung’s product line-up for the holidays is set in stone. My feeling is that Q4 will continue to show falling revenue and profit year on year. The company has one more throw of the dice to stay on top of the Android pile – a new device range launched at or around MWC in February 2015.

Honestly I think they’ll carry on with an iterative product line and continue to rely on marketing to deliver the same volume of sales without addressing the falling revenue per handset numbers. During the summer of 2015 Samsung will leave the number one spot in the sales charts, and the smartphone world will pick up a new favored manufacturer.

Author: Vishesh Tyagi
Source:
http://www.businessinsider.com/how-to-save-samsung-2014-11
http://www.zdnet.com/samsung-mobile-profit-down-by-a-third-in-2q-2014-7000032172/