Samsung reportedly shipped nearly 10 million Galaxy S7 units in March, besting analyst expectations
Initial perspectives for the S7's market performance were somewhat gloomy, as analysts had lowered their expectations amidst signs of a slowdown in demand for premium phones. Investors were also sceptic towards Samsung's projected belief that S7 models will outsell previous models on the basis of stronger than expected pre-orders. Samsung's January – March operating profit was expected to fall 16% from a year earlier to 5.2 trillion won ($4.51 billion), the lowest in six quarters.
"From the investors' perspective, there's nothing wrong with making money without innovation."In addition to the good premium-tier sales, Samsung ramped up its efforts in the mid and low tiers to secure its market share. It also introduced the S7 and S7 edge a month earlier than last year's Galaxy S6, taking advantage of Apple not having new products out at the time. Analysts characterized both moves as solid market strategy on Samsung's part. Moreover, the incremental changes to the Galaxy S6's successful formula, which were expected to detract from customer attention, actually served to improve earnings, as the similarity between the smartphones helped reduce component and development costs. It also let Samsung ask a lower price for the S7, up to 8.3% cheaper in the critically important Korean market. "From the investors' perspective, there's nothing wrong with making money without innovation," said Lee Jin-woo at KTB Asset Management.
Samsung said its earnings were not yet finalised, and it declined comment on sales or shipments for the new handsets.