Does Samsung regret that it has not been able to innovate, or does it simply regret that sales have fallen?
What you need to know
- Samsung’s vice chairman of Samsung Electronics’ DS division, Jeon Young-hyun, issued a rare apology for the company’s inability to innovate.
- The release comes after Samsung’s latest phones, the Galaxy Z Fold 6 and Galaxy Z Flip 6, reportedly weren’t selling well.
- Moreover, recent reports from International Data Corporation show that Samsung is losing smartphone market share while its competitors are gaining market share.
It’s rare for one of the world’s largest tech companies to admit it’s facing a major problem. Well, that’s exactly what Samsung’s vice chairman of Samsung Electronics’ DS division, Jeon Young-hyun, did in a press release this week. Young-hyun acknowledged that outsiders view the company’s current situation as a “crisis” and vowed to make changes and improvements that will benefit investors, customers and employees alike.
“To our customers, investors and employees who have always loved Samsung Electronics, today we, the management of Samsung Electronics, would first like to apologize to you,” the press release said, translated into English.
“The performance that did not meet market expectations has raised concerns about the company’s fundamental technological competitiveness and future. Many people are talking about Samsung’s crisis,” the statement continued. “All this responsibility falls on us who run the company.”
The past two years have not been smooth sailing for the South Korean tech giant. First, financial results and profits started to decline in 2023, following encouraging figures following the pandemic. The release of the Samsung Galaxy S24 series didn’t seem to improve things significantly, with Samsung losing market share to its competitors in 2024.
The unrest also focused attention on Samsung in a less than favorable way. In April 2024, Samsung initiated a six-day work week for executives to create “a sense of crisis” among the company’s leadership team.
Following criticism of the new Galaxy wearables, which were seen by many as imitations of Apple’s design, it was reported that Samung MX division chairman Lee Jae-yong was “angry” about the team’s design . This, of course, made us wonder why a Samsung chairman only found out about the products’ designs after they let go.
Which brings us to the moment where Young-hyun publicly apologizes for the company’s lack of innovation.
“Samsung has a history of challenge, innovation and overcoming that has always turned crises into opportunities. We will certainly turn the grave situation we are currently facing into an opportunity for a leap forward,” the statement said.
“Above all, we will restore the fundamental competitiveness of technology. Technology and quality are our lifeblood,” Young-hyun wrote. “It is the pride of Samsung Electronics that we can never compromise on. Instead of short-term solutions, we will safeguard fundamental competitiveness.”
Despite Samsung’s efforts to put things right in April 2024, the so-called ‘crisis’ appears to be getting worse before it gets better. The recently launched Samsung Galaxy Z Fold 6 sold less than 300,000 units in its first two weeks of availability, according to the leak. Ice Universe on X (formerly Twitter)who has a solid track record. That’s fewer units than the Galaxy Z Fold 5 sold last year, according to the report, and appears to continue Samsung’s decline.
Samsung Galaxy Z Fold6 is worse than Fold5… It seems AI alone cannot save Samsung. Only 270,000 copies were sold worldwide in the first two weeks.August 28, 2024
Official estimates of International Data Corporation (IDC) confirm that Samsung has lost smartphone market share as of the second quarter of 2024 compared to the same quarter in 2023. IDC reports that although Samsung moved more than 53 million smartphone units in the second quarter, its market share fell to 18.4 percent – compared to 20 percent in the second quarter. same point last year. Meanwhile, competitors Xiaomi and Vivo expanded their market share year after year.
For what it’s worth, Samsung shipped more phones than anyone else in the second quarter of 2024. However, it can’t be a coincidence that Xiaomi and Vivo – both of which are pushing the boundaries of smartphone technology outside of North America – are catching up to Samsung, as the company, by its own admission, isn’t innovating as it should.
All the ways Samsung has stagnated with recent releases
As someone who has closely followed Samsung’s product launches and financial results in recent years, it’s not particularly surprising to me that sales are suffering. The company releases new devices, but does not push the boundaries in a competitive smartphone market.
Take the standard Galaxy S24, which still has the same camera system as the Galaxy S22. There’s no reason why we should have to go three generations between camera upgrades. That’s especially true as Apple and Google continue to improve the camera systems on their flagship models. All in all, perhaps the best feature of the Galaxy S24 was Galaxy AI, which eventually made its way to the Galaxy S23 series.
The worst offender is the Galaxy Z Fold 6, which shares the same main rear camera as the base Galaxy S24. That’s despite the fact that the Galaxy Z Fold 6 costs over €1,000 more than the Galaxy S24 – and that it is actually the same camera sensor as the almost three-year-old Galaxy S22. I’ve spent weeks with the Galaxy Z Fold 6 and the Google Pixel 9 Pro, and it’s Google’s foldable version that feels more innovative and exciting. There’s no doubt about it.
It’s hard to accept Samsung’s apology as a reporter and reviewer who has closely followed the company’s incremental updates for years and seen brands like Pixel, OnePlus, Oppo, Vivo, Xiaomi and Honor beat Samsung in terms of innovation. That said, it takes courage to acknowledge the elephant in the room, especially when you’re a company as big as Samsung. We hope things improve, starting with the upcoming Galaxy S25 series next year.
