Samsung to slash smartphone portfolio by 30 percent in 2015
KOREAN PHONE MAKER Samsung has said that it will trim its smartphone portfolio by 30 percent in 2015, following its disastrous third-quarter earnings.
Samsung said at an investor event in New York this week that it plans to release fewer smartphones next year, after its third-quarter earnings last month revealed that sales of mobile devices dropped by 74 percent between July and September.
A report in The Wall Street Journal said that Samsung will cut the number of models by 25 to 30 percent in order to reverse declining profits, although it has not yet said which models are likely to get the chop.
The firm added, however, that it also plans to 'increase the number of components shared across mid- to low-end models [to] further leverage economies of scale'.
This suggests that the company will focus on less expensive smartphone models in order to rival the likes of Xiaomi, which earlier this year became the world's third largest smartphone maker - albeit briefly.
It appears that Samsung, which is still the world's largest smartphone maker despite its recent turmoil, has already started to put its plan into action.
Samsung launched the Galaxy A3 and Galaxy A5 smartphones last month, the first models in the company's mid-level offerings to sport metal body designs.
The company is promising a return to double-digit profit in 2015, but warned during its Q3 earnings call: 'Although the company anticipates a demand growth for the recently launched Galaxy Note 4 and new middle-end smartphone models, uncertainty remains for the [mobile] division, due to the year-end surge in competitor smartphone launches, which may require a potential increase in marketing expenses associated with year-end promotions.' µ