Smartphone market dips as Samsung warns of massive profit slump
South Korean tech giant Samsung has warned that its profits for the first quarter of 2019 will plunge by 60 percent compared to last year. This is due to a reduced demand for smartphones across the world. The company said that the demand for memory chips and display panels had gone low with sales declining by 14 percent.
Samsung estimates that earnings for this quarter will total USD 5.4 billion, way lower than last year’s. In 2018, the smartphone market shrank by 4 percent and CNN reports that market research firm ICD expects it to contract further. Samsung’s main rival Apple already reported a slump in sales due to market saturation according to analysts.
Despite the global plunge, sub-Saharan Africa has witnessed a growth in smartphone acquisition and subscription since 2016, a trend likely to continue into 2020. A Communications Authority of Kenya report shows that mobile subscriptions in Kenya increased to an all time high of 108 percent, though many of the subscriptions are attributed to individuals owning more than one SIM card. Out of this percentage, smartphone users prefer low-priced brands such as Xiaomi, Oppo, Infinix, Tecno, Injoo, among others. Transsion Holdings which manufactures Tecno and Infinix has the biggest share of the African market with 30.1 percent with Samsung trailing with 26.1 percent.
Online vendor, Jumia also recorded a rise in smartphone sales in the last two years, which accounted for more than 95 percent of phone sales on its platform while feature phones accounted to only less than 5 percent.