Forget About Note 7 & Recalled Washing Machines Samsung Is On A Roll
Samsung Electronics Australian operation is set to have a big year in 2017, if the products rolled out at CES are anything to go by.
On top of this the Company who rolled out record profits on Friday, is set to launch a new Galaxy 8 smartphone, and later in the year new Harman sound systems.
It was only two months ago, that media organisations such as Fairfax Media and News Corporation were predicting doom and gloom for the Korean Company following the recall of their Note 7 which cost the Company an estimated $8 Billion.
Samsung’s recall of overheating Galaxy Note 7 phones and problems with their washing machines saw media Companies hyper ventilate over the issues.
Long term I doubt that the two issues will impact the Samsung brand, with consumers quickly forgetting the past as new exciting products housing cutting edge technology as we have seen at CES are released into the Australian market.
In reality the Note 7 wouldn’t have sold more than 15 million units globally, this is small fry when compared to the more than 300 million handsets that Samsung sold in 2016.
As for their washing machines several of the major atomotive Companies had recalls last year but consumers are still buying their motor vehicles in the tens of thousands.
In fact, Samsung’s latest flagship phone, the Galaxy S7, has shown surprising resilience in the Note 7’s absence, enjoying brisk sales during the fourth quarter—nearly a year after it was first released.
What Samsung delivered on Friday was fourth-quarter earnings that were the highest in more than three years. The reason: competitors’ growing demand for Samsung components.
While Samsung’s smartphone results took a hit, the company grew revenue by selling their technology to the likes of Apple, Sony and HP.
In 2017, the local subsidiary will benefit from the roll out of their new QLED TV’s which attracted “excellent” reviews at CES. At the heart of the QLED line — which includes the Q9, Q8 and Q7 sets — is a refined metal Quantum Dot material.
This technology lets the TVs show off a wider range of colour. Samsung says the QLED sets can display 99 percent of the DCI-P3 color space, and they can also show off full colour volume no matter their brightness. Up until now, you’d typically lose color accuracy as you pumped up your TV’s brightness.
The QLED models also feature a peak luminance between 1,500 and 2,000 nits, whereas last year’s SUHD models topped out at 1,000 nits. That means bright areas of the screen will pop even more, especially with HDR material. The new quantum dots also allow the sets to produce deeper black levels than before.
Samsung Australia will also release a new appliance offering that delivers cutting edge technology in a pair of flexwash and flexdry machines.
Samsung has added the 1.0-cubic-foot compartment to the top. It only requires a single water line for hook-up, but each drum can be operated independently or together with different cycles. The larger drum is 4.5 or 5.0 cubic feet, depending on the model, putting it on par with larger-capacity washers.
The FlexDry’s main compartment is 7.5 cubic feet for regular drying. Up top is a separate rack, which lets warm air circulate to the clothes you have drying there. It’s meant to be an energy-efficient way to dry — in about an hour — more delicate garments you don’t want tumbling around in the drum. Both the FlexWash and FlexDry have Wi-Fi connectivity to help with troubleshooting and to let users download new cycles.
The devices are tipped to launch in the second half of 2017.
Samsung is a big Corporation ,and their stand at CES demonstrated the prowess of the Samsung R+D teams from new sound systems that upscale audio to 32 bit to a new top end gaming monitor and PC notebooks to simple technology such as their all new wafer thin TV cable that eliminates clutter when connecting a TV.
Samsung’s ability to shake off the recall of 2.5 million Note 7 smartphones last year highlights the depth of this Company, when it comes to sustaining a major hit in the market.
Its forecast US$7.76 billion fourth-quarter operating profit sent a clear message to their competitors and the market.
Back in 2014, Samsung’s mobile phones were the cash cow. But with consumers no longer snapping up new phones every year, the company—which is the world’s biggest maker by shipments of both smartphones and memory chips—has shown there is plenty of profit to be made in the parts of devices not visible to most consumers.
recognising that the smartphone market was slowing Samsung moved to pour tens of billions of dollars into semiconductors and display panels to enable phones to run faster, hold more storage and offer crisper images.
Recent advances have made its components more powerful than those of competitors—positioning Samsung as an essential parts supplier for many of its rivals.
Apple who have no manufacturing operations are reliant on Samsung and when a consumer ditches a Galaxy phone for a competitor’s product Samsung are still making money.
“If Apple does well, Samsung benefits from that,” said Sanjeev Rana, a senior analyst at CLSA, a brokerage, in Seoul.
In the TV market Samsung Australia is under pressure from Chinese brand Hisense.
Philip Newton the Vice President of Marketing at Samsung Australia, said that “For the first time we are really taking notice of Hisense”.
He believes that their technology still has a “long way to go” before it can be compared to similar technology from the likes of Samsung, LG and Sony.
A Display Search analyst said “Hisense is selling on price, they are discounting similar looking TV’s out cheaper than the big brands and this has appealed to consumers”.
He added “They don’t have the brand clout at this stage to sell on other than price and long term this could hurt them”.
In contrast arch rival LG Electronics said Friday, that it expects to report its largest quarterly loss in seven years.
Analysts say the fourth-quarter hit was most likely driven by the company’s mobile division.
In Australia LG smartphones are struggling to get traction due in part to poor marketing and a decision by the Company to move into the attach market a move that has backfired due to consumers rejecting the concept.
LG estimates that it will lose $29.8 million in 2016’s final quarter.
Last November, Samsung announced that it would invest more than $1 billion in its Austin, Texas, semiconductor factory to beef up its production of processor chips for smartphones and other devices. Samsung is also investing close to $10 billion to expand its production of organic light-emitting diode, or OLED, displays that are thinner than traditional liquid-crystal displays.
Despite the company’s woes with the Galaxy Note 7, investors pushed Samsung shares to record highs in the past week. On Friday, the stock rose 1.8%, giving Samsung a market capitalisation of more than US$240 billion.