TechnoStorm

Galaxy S4 can't lose: market consensus

Seoul (The Korea Herald/ANN) - The Galaxy S4, the latest in line from the world's largest smartphone maker Samsung Electronics, is at the center of a controversy over whether or not its sales will slow due to rumors and several unfavorable brokerage reports.

But concerns of slowing sales seem to be far amiss from what is actually happening in markets all over the globe.

Samsung's Galaxy S4 has been selling briskly in markets all over except for Korea, where the Galaxy S3 and the Galaxy Note 2 are still going strong.

In the U.S., the Galaxy S4 beat Apple's iPhone according to a survey of U.S. wireless carrier retail stores by Canaccord Genuity, a Wall Street research firm.

All carriers with the exception of AT&T showed the Galaxy S4 outselling the iPhone 5, Apple's latest smartphone. This made Samsung the best-selling brand ahead of Apple.

Last month, Samsung announced that it had sold more than 10 million Galaxy S4 units globally after just a month of release to set a record.

The total shipping target for the device varies, but most brokerages here appeared to believe Samsung was ready to ship at least 70 million units - which is a bit shy of the 100 million that Samsung reportedly is prepared to churn out according to the orders it has placed with its part suppliers.

"The figures are a bit flexible, but we believe 70 million to be about right considering that the conditions at Samsung have not changed. It's mostly the external conditions that are weighing on its shipments," said Song Jong-ho, a senior analyst at KDB Daewoo Securities.

The global mobile phone market has not been in its best shape, as the market size this year is around 60 percent of last year, with forecasts for high-end, premium smartphones looking not at all rosy as the industry anticipates the advent of new low and mid-end phones.

Daewoo currently has a 10 trillion won operating profit target for Samsung Electronics in the second quarter, a view that has the support of many local brokerage including Shinyoung Securities, Kiwoom Securities and NH Investment and Securities, to name a few.

The 10 trillion won figure would not be a stretch when considering that the Galaxy Note 3 is to be released in August, while the Galaxy S3 continues to be a steady seller for Samsung.

For quarterly sales, Samsung continues to expect 20 million, which was the record set by the previous model, the Galaxy S3.

"How President Obama decides on the latest International Trade Commission ruling may further give Samsung a push in its sales," said one senior industry watcher.

Earlier this month, the U.S. ITC ruled that some of the older iPhone and iPads infringed Samsung's patents. President Obama will have around 20 more days or so to veto the ruling.

Regarding the reports and sales adjustments from the foreign brokerages, analysts noted that there was a certain "tendency" among those outside the country to see Samsung in a less favorable light.

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