Home / / Samsung market cap drops by $44bn

Samsung market cap drops by $44bn

Since April, Samsung's value has plummeted by amount equivalent to entire value of General Motors

Samsung market cap drops by $44bn
Samsung’s third-quarter net income is estimated at 5.33tr won ($4.5bn)

Samsung’s market capitalisation has dropped by about $44bn since April 2015, driven by increasingly sluggish demand for its new range of Galaxy smartphones.

According to Bloomberg, the drop in value that Samsung has experienced over this time period is roughly equivalent to the entire value of General Motors. Sales of Samsung’s smartphone range have been in decline for five straight months, as the company has lost high-end market share to Apple’s large-screen iPhones, and low-end market share to Chinese upstarts such as Xiaomi.

Investors are hardly bullish about the effect that the Korean giant’s latest smartphones, the Galaxy Note 5 and Galaxy Edge+, will have on the next earnings report. Samsung’s strategy was to push out new products ahead of Apple’s September 9 event, at which Cupertino is largely expected to launch new iPhones. However, markets are pessimistic about whether that strategy will have had any effect.

Bloomberg said that Samsung’s third-quarter net income is estimated at 5.33tr won ($4.5bn), compared to the 5.63tr won for the quarter ended in June.

While Samsung’s mobile devices unit is struggling, however, the company is making strides in chip manufacturing. Already the manufacturer of Apple’s A-series of chips, Samsung still benefits from the enormous sales successes of the iPhone. What’s more, the company has been investing heavily in new production facilities that will help it develop and manufacture chips for other OEMs. Some analysts point to chip production as a plausible replacement for Samsung’s ailing smartphone business.

Follow us to get the most comprehensive IT business news delivered fresh from our social media accounts on Facebook, Twitter, Youtube, and listen to our Weekly Podcast. Click here to sign up for our weekly newsletter on curated technology news in the Middle East and Worldwide.