The Samsung Note 4 phone apparently shipped to market too early in order to compete with the successful iPhone 6 launch. Samsung has already acknowledged that there are major defects in the phone body but has yet to provide a resolution. The jokes are trending on Twitter under #gapgate.
Samsung profits continue to fall for the third straight quarter. Not since the third quarter of 2012 have profits been so low. The profits were weaker than expected and blamed on poor phone and tablet sales, over-shipments of lackluster smartphones, the recently-strong Korean Won, and strong competition from the iPhone and numerous Chinese smartphone makers. Samsung faces an uphill battle to grow their phone and tablet business as loyalty to the brand falls. Users blame lackluster new phone features, poor battery life, faulty batteries, unstable Samsung-branded add-on apps, and other quality issues. As Apple prepares large-screen scratch resistant iPhones, Samsung needs to look for new growth engines as analysts predict sales to continue to lag.
Following a disappointing launch and scathing reviews for it’s recent S5 phone, Samsung’s head mobile designer has been removed from his position. Chang Dong-hoon, who many believe took more than inspiration from the iPhone series, was forced to resign and will move onto other Samsung projects. Samsung’s latest S5 phone was given the moniker “looks cheap and feels cheap” by the International Business Times for it’s feel and construction.
Samsung’s over-reliance on mobile phone sales brings weak profits again this quarter. Profits fell 4.3% due to sluggish handset sales and a poor domestic launch for their S5 (and a gloomy forecast for the next quarter). Samsung gets 70% of their revenue from phone sales. This represents over 75% of the Samsung group’s profits.