Samsung sheds $8bn off its market valuation; investors worry that its growth is coming to an end

Samsung sheds $8bn off its market valuation; investors worry that its growth is coming to an end
Samsung's first day of the new year on the stock exchange is unlikely to have been as glorious as the top execs had hoped for when celebrating 2014 – the company shed about 4.6% off its market valuation after a poor start in the morning that set the tone for the entire trading day. That's the equivalent of $8 billion.

Now, while finances are a bit remote of an area from our usual field of expertise, industry watchers do have a few things to say about why Samsung isn't doing quite so well. First and perhaps foremost, the higher-end niche of the market has reached saturation – an argument we've seen being brought up repeatedly throughout 2013. This obviously means that the South Korean company simply no longer has access to as vast a pool of potential adopters of its more premium offerings, the ones that usually carry the highest margins. Along the same lines is the argument that price competition from the now many rivals worldwide is putting more and more pressure on Sammy. One could even see how said pressure has been enough to force the Seoul-based company to follow suit, as its vast brand cache gets at least partially disarmed when confronted with customers that are simply looking for the greatest deal available. This is especially true in regions with easy access to the Nexus line of devices, and now the Motorola Moto X and Moto G, all of which offer an arguably equal, even higher bang for your buck, unless you're completely sold on a particular Samsung phone or feature. It's therefore not too surprising to see that at least some people are worrying over their investment. Despite this rather gloomy-sounding analysts' repertoire, Q1 is actually shaping up to be quite a product-rich quarter for Samsung, with as many as four new tablets expected to see the light of day, and perhaps even the next-in-line Galaxy S5 and a new, less costly version of the Galaxy Note 3.

via: TechCrunch, Reuters

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40 Comments

1. shahulvm

Posts: 124; Member since: Apr 01, 2012

Good...For once, we shall see less flooding of the same devices with different names... All that goes up, must come down...They reaped the consumers when they got their chance.. For heaven sake, concentrate your R&D on giving the consumers better battery life with lesser profits..

4. Mxyzptlk unregistered

Their quality control department needs more concentration than anything.

30. Astoni

Posts: 649; Member since: Sep 28, 2013

For once i can agree with you :p

38. Doakie

Posts: 2478; Member since: May 06, 2009

I know I'm jinxing myself and I'll probably have a failure as soon as I hit "POST REPLY" but my Note 3 hasn't had any problems. What was the last Samsung device you have owned?

39. Astoni

Posts: 649; Member since: Sep 28, 2013

Galaxy s3 :p, i loved it tbh. but i was mostly talking about the lower end sh*t they make.., Mxyzptlk is a i(shee)(p).. i bet he havent even touched a samsung device..

22. Extradite

Posts: 316; Member since: Dec 30, 2013

Well the problem is the battery does not need a revolution, what they should've done is make the device weight more to 200Grms, with 4000Mah battery. I personally wouldn't mind the weight as long as it's heavy and not thick. Surely they did, gone are the days when Samsung were making quality metal, aluminuim phones: F700 P300 Omnia Blackjack 810 Steel X830 D800 Those were quality. Know they just make devices with cheap lastic. The 90s 80s 2000 were the days when everything a company use to make was built very well and used quality materials. Look at Sony Jvc Philips Sharp Panasonic Audiolab Marantz Nakamiki Technics Kenwood Onkyo Denon And so many others.....

37. giani

Posts: 269; Member since: Nov 13, 2012

samsung HQ R&D Department : "ok boys...in the past we've spend 2 billion to find different names for plastic. We had polycarbonate... this year we have faux leather....we need to find something for next year...GET TO WORK !

2. sri_tech

Posts: 188; Member since: May 21, 2013

Nothing lasts forever.

24. ihavenoname

Posts: 1693; Member since: Aug 18, 2013

Samsung will be fine. They dominate mobile market, and they have reasonably good loyalty. And Samsung makes TVs, Digiboxes, Washing machines, even Cars, almost everything which has something to do electricity, so they will be more than fine. Nokia made only smartphones, that's why they fell down. Same might happen to HTC.

31. Sauce unregistered

I agree with the man whom has no name.

32. Extradite

Posts: 316; Member since: Dec 30, 2013

And so do i. Well said.

35. applesucker

Posts: 81; Member since: Oct 29, 2013

they even make military weapons and hardware and also frigates, destroyers and cruisers for the south korean military

3. Mxyzptlk unregistered

That's what happens when you oversaturate the market with device after device with the same name. Knock Apple all you want, but keeping their product small yet diverse has allowed them to avoid saturation. HTC made the same mistake and look where it got them. Keep the galaxy s line along with the note series and stop releasing so many variations of the same plasticky phone.

5. AntiFanBoyz unregistered

Riiight... that explains everything!!! I mean, thats why Apple lost over 40% from Sept '12 to May '13, right??? You're seriously pathetic in your bias. In tech a 5% swing in stock is nothing. Heck, +/- 10% swings aren't uncommon. Get back to me when they're down the 40% Apple dropped.

8. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Don't waste your time on this fruity fanboy. No matter what Apple do, this fruity fanboy will agree with Apple and think Apple is right.

9. Mxyzptlk unregistered

So says the guy with droid in his user name. Maybe you should actually read my comment first before jumping to insults.

12. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Says the fruity fanboy who praises Apple every time. Maybe you should look at what you posted all along, blind fanboy comments from Mr. Mxyzptlk everywhere.

28. Mxyzptlk unregistered

Why don't you come up with some new material and better comebacks.

29. Extradite

Posts: 316; Member since: Dec 30, 2013

What's wrong with you today Mxzy...? You never hardly post good post like this...? Normally biased when you post. ExperiaDroid Mxzy is totally right, give him credit where it's due. He was not biased. Read his posts again. Beside the point we all know Mxzy loves Apple, but sometimes he's normal and not biased. Normally you would see him on Moto articles, hating, not trolling on it. I hardly and never agree to his posts, but surely he got 6 thumbs up. Look what happened to Darkkjedii a year ago he use to not like Android, and use to troll and see him get "Limited" but PhoneArena turned him into a techy, cause he was fed up with getting sent away for 7days vacation. So he stopet trolling. Mxzy deserves a credit and he said it wisely

36. Mxyzptlk unregistered

I'm being my normal self. +1. I see Xperia ran away after he dug a hole for himself and couldn't climb out of it.

10. Mxyzptlk unregistered

Apple reached a high point with their stock. Take an economics class and learn something for once. For Samsung this is a forewarning for things to come. I'll break it down so you can understand it. HTC stock fell. HTC started having problems. HTC made too many phones and now HTC is bleeding money. Samsung is treading their footsteps. Checkmate.

13. xperiaDROID

Posts: 5629; Member since: Mar 08, 2013

Checkmate? lol You're DENIED.

25. ihavenoname

Posts: 1693; Member since: Aug 18, 2013

Mxy, unlike HTC, Samsung has other businesses than smartphones...

15. AntiFanBoyz unregistered

Dumbest comment of the year, but you're lucky... the year is young. This isn't about economics, it's about logic vs asinine "I'm so smart" predictions about virtually meaningless data. I'll break it down so you can understand it. Apple stock fell. Apple is doing just fine. Apple will go on. Samsung is treading their footsteps. See what I did there. I made the completely opposite argument of you using the exact same level of logic.

17. oister85 unregistered

Htc is the one who follow Samsung steps. Samsung is been floating the market seems they are alive.

26. Extradite

Posts: 316; Member since: Dec 30, 2013

That's right. They never had a Emblem of a device, like Apples: iPhone 1,2,3,4,5 Samsung Galaxy 1,2,3,4 Note 1,2,3 Sony finally have there Experia, and Z series LG finally following SS, Apple, with numbers. So stop the diffrent name, and focus on one name brand, so as time, months years pass by, there will be a recognition.....

27. HASHTAG unregistered

I usually disagree with everything Mxyzptlk says, but he's actually spot on with his original post.

34. xfire99

Posts: 1206; Member since: Mar 14, 2012

HTC fell is coz Samsung arise, not that they are releasing too many models and if Samsung is taking after HTC, isnt Apple the doing same thing? Before Apple had only 2 versions of iphone, normal and then S, also only 1 Ipad version and now, they are also following HTC footsteps. Iphone 5/C/S, Ipad/mini, all with WiFi/LTE and dont talk about 8/16/32/64/128GB. That is the heck alot of different versions too too sort out. Just as others said, Samsung isnt only in smartphone business and thanks too android, they are dominating this too. Unlike HTC&Apple, that are relying on smartphones/tablets sales and Samsung can survive even with dropped sales in mobile devices. Samsung: - Worlds largest television manufacturer. - Worlds largest of mobile phones and smartphones. - Major manufacturer of electronic components such as lithium-ion batteries, semiconductors, chips, flash memory and hard drive devices for clients such as Apple, Sony, HTC and Nokia. HTC&Apple is just a small company compared to multinational company Samsung. But I dont like that Samsung are dominating in too much areas and without competitions. They can set whatever prices they want and do whatever they want.

18. fanboy1974

Posts: 1345; Member since: Nov 12, 2011

How is not having more products like a larger phone/phablet helping Apple? Or what about the ipod touch still on the market for $200 when you can get a Verizon Moto G for $99? Samsung got powerful because of Apple's unwillingness to adjust. Same can be said about other Android oem's but at least their turning things around. Samsung is not losing sales to Apple, their losing sales to other Android oem's such as Motorola, LG, Asus and HTC. Got to figure that even the Nexus phones and tablets are stealing Samsung's customers as well. Don't think for second that Samsung's growth issues is because Apple has only a few models. Its because better Android products are in the market. Last time I checked Apple is still losing phone and tablet market share.

23. Extradite

Posts: 316; Member since: Dec 30, 2013

I never agree with Mxzy, but this post +1

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