Samsung to retire the Galaxy S3 early, cut S4 production

Samsung to retire the Galaxy S3 early, cut S4 production

Summary: Reports suggest that Samsung may be retiring smartphone models with low sales figures early -- the Galaxy S3 included.

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Samsung is planning to retire the Galaxy S3 smartphone sooner than planned as well as reduce the monthly production numbers of the flagship S4.

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According to Korean publication ET News, the South Korean electronics maker is going to reduce the parts inventory and manufacture of a number of smartphone models, and retire others to streamline operations.

The monthly production levels of the Galaxy S4 is expected to be reduced by 10 - 15 percent. The publication says that July's Galaxy S4 order is for 6.5 million handsets, which is only half of the amount requested two months previously. In April and May, the tech giant procured parts for over 10 million handsets, but after the model's official launch, production is now on the wane.

A recent JP Morgan report demonstrated fears over the Galaxy S4's sluggish sales. In June, the financial services firm cut share-price estimates by 9.5 percent, and lowered the company's 2013 earnings estimate by nine percent -- which sent shares plummeting.

JP Morgan cited poor European consumer demand as the reason for lower-than-expected shipment rates, and as a result cut predictive annual S4 shipments by 20 - 30 percent. Originally, the South Korean firm was expected to sell 80 million Galaxy S4 units this year, but estimates are now closer to 60 million. In response to the report, CEO Jongkyun Shin denied there was a problem with current sales figures.

In addition to cutting the S4's production levels, the S3 is reportedly due to retire earlier than expected -- joining a number of models that will be cut away due to poor sales performance. Samsung will not be able to raise marketshare rates and compete against rival Apple using only the flagship Galaxy S4 smartphone, and so rumors suggest the firm will be launching a new range of models from the Galaxy Note III to Galaxy S4 Mini and to Galaxy S4 Zoom.

According to Gartner, Samsung's smartphone marketshare grew 13 percent in Q1 2013. The electronics maker's global smartphone marketshare reached 30.8 percent, whereas rival Apple is estimated to have secured 18.2 percent of worldwide sales.

Topics: Samsung, Mobility, Smartphones

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22 comments
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  • Is Samsung Taking The Lion's Share Of Android Profits Or Not?

    Looks like competition from other Android players is evening up the score a bit. Isn't a free market wonderful?
    ldo17
    • i don't think its competition

      It's that a new android phone is a worthless upgrade, nothing is new, just gimmicks added to last years phone.

      Same as getting a new iphone is pointless.

      Switching to or from iphone, bb, WP8 or android is really the only good reason to buy another phone.
      everss02
      • Re: i don't think its competition

        Of course it is. Other Android OEMs like LG, Huawei and ZTE have recorded massive growth of 50-100% in the last quarter alone.

        Android is still full of opportunity and growing like mad.
        ldo17
        • That's in China and India

          they are so poor they would never buy a flagship phone of any brand or OS in large numbers, they just have half the world's population, but are dirt poor
          everss02
          • Re: That's in China and India

            What's wrong with China and India? Is their money not as good as yours?
            ldo17
          • u fucking idiot

            the people like u ( a butthole ) never like to peep out of your windows. dirt poor indian and china ? these are the two countries has highest growth rate. china iphone 5 demand is highest after usa and indian is the country which saved apple ass last quarter. most numbers of luxary cars market are selling in indian and china. u butthole purchase iphone free on contract. but we in india are paying 28000 rs means around 500 dollors for a outdated iphone 4 and you should check the sell of iphone 4s in india asshole of your mother
            Yogesh Chaudhary
      • ?

        EVERYTHING about the S4 is a considerable upgrade over the S3. And the ability to interact with the S4 without even touching it while I have barbeque sauce, grease, soap or dishwashing suds on my hands isn't what I would call "gimmicky".
        trob6969
        • yeah it is

          what do u bark at it to unlock it, just to get to the stupid eye tracking crap.
          everss02
        • No-hands interaction...

          I can talk to my *S2* and do 99% of what I need it to... since when is the ability to use one's phone without touching it a major upgrade?
          EnKrptyed
        • Hand's Free

          Using a phone without touching it is really important for car drivers, and many would definitely choose a phone where they don't need to buy an extra kit.
          Peter Austin
  • Smart phone fatigue

    From the release of the iPhone5 and on, most of the high end devices have been very underwhelming. I would not be surprised to see a slow down in many hero phones.
    Emacho
  • Give me a reason to upgrade

    The onyl reason I upgraded from iPhone 4 to iPhone 5 is because by the time my contract was up, my iPhone 4's "Button" barely worked. I had to press it and hold it in order to get it to trigger "sometimes." If phone had not failed, I would probably still have it. My wife's top on/off button had not worked for almost a year. So we upgraded. That was $600 i did not want to spend. Since I've already had my iPhone replaced once due to a failed antenna, I'm not counting on this phone lasting me past the two years again.
    A Gray
    • Sure is a lot of failures.

      Why buy them again if you don't expect them to last?
      Emacho
      • Probably because the interface is so good...

        ...people are willing to deal with some hardware pain just avoid the alternatives. Ouch.
        Playdrv4me
  • I do think...

    that Smartphone saturation, phase I has happened. Not to say that there still won't be sales, but as a couple of others have pointed out, I need a reason to get rid of the Google Galaxy Nexus I bought May of 2012. Yes there are a few new things that this phone can't do, but nothing I need. Churning a new phone every 12 months may make some people feel like they have "the latest and greatest" , but not much beyond that.
    jkohut
    • Re: I do think... that Smartphone saturation, phase I has happened

      Which is why Android hasn't shown much over 35% growth year-on-year.
      ldo17
      • 35% growth year over year? Not many things will show that kind of growth

        in an established market. 35% YoY growth would be fantastic for any line of product.

        Perhaps you meant Android hasn't shown much growth over the "35% market share" it already owns. Only a new player in the market could show 35% or more growth, since it's quite easy to show that kind of growth when the actual numbers are low in the beginning.

        Android is not the only OS that has not show much growth, if any at all. iPhones have also slowed down. BB and WP8 might be the only ones showing growth, but, growth from a low number for a new player, is quite easy to do.
        adornoe@...
        • Re: 35% growth year over year?

          Sorry, I was wrong. Please accept my humble apologies.

          It was more like 43%.

          http://www.gartner.com/newsroom/id/2482816
          ldo17
          • Think about what growth means...

            Say a market has 400 million users already in possession of smartphones.

            The 400 million keep using smartphones, and an additional 20 million enter the market by purchasing 20 million smartphones. That's a total of 420 million using smartphones.

            Now, amongst the original 400 million people who already had smartphones, they decide to upgrade or change plan providers, which might mean some 100 million "new" and updated smartphones get sold. That would mean some 120 million smartphones sold for that year. Yet, the market did not add 120 million smartphone users, since 100 million of those sales were to already established smartphone users. Thus, the net increase in smartphones was really 20 million, and most of the sales were as replacements. The OEMs do still get the benefits of the sales, but the market didn't really increase that much with the 120 million in sales.

            Growth implies "new", as never having been a consumer to the particular market of smartphones. YoY growth in sales might be true to the device makers, but to the cell plan sellers, the increase in users, is not the same.
            adornoe@...
          • Re: Think about what growth means...

            It means Apple and Microsoft are getting left further and further behind.
            ldo17