Industry sources have told Digitimes that Samsung has slashed its orders for parts and components for its Galaxy S4 smartphone for the second and third quarters of this year, citing a “slowdown in demand in the end market”. They added that orders will suffice for the production of 20-25 million units of the smartphone in the second quarter, and 20 million units in the third quarter.
Industry sources, though, clarify that this development does not mean that Samsung is losing its hold over the smartphone segment. Top smartphone manufacturers, Samsung being one, are constantly being faced with a rising demand for entry-level and mid-range smartphones in emerging markets like India and China, than for their high-end smartphones. Not only is this leading to lower average smartphone prices, but also causing the demand for high-end smartphones to reach a saturation point.
Lowering orders for parts and components
A similar point was made by a recent IDC report that said a billion smart devices will be shipped to emerging markets by 2014. A budding market for entry-level and mid-range smartphones, emerging markets are now being pegged as being capable to drive the next big wave of tablet and smartphone adoption.
To see how the smartphone is faring in India, we got in touch with our sources in the grey market. We're told that as on today, the Samsung Galaxy S4 smartphone is their best-selling one, followed by the Galaxy Grand. Our source said that the demand for the once very popular Galaxy S3 smartphone is slipping.
Incidentally, Digitimes also states that Samsung’s market position has also been affected by flagship releases from HTC, Sony and Huawei. Sources, however, say the company will be able to maintain its lead position by shipping over 70 million smartphones in the third quarter.