Worse, Samsung is being squeezed from the middle, too. And since corporations are people, too (SCOTUS says; look it up), and Samsung is all macho taco, then a middle squeeze of corporate body parts that don’t squeeze all that well calls for an especially painful hurt.
Samsung, maker of fine Galaxy class plastic gadgets, and the company once the darling of iPhone haters and Apple bashers, has struggled the past year to make profits that compete with Apple’s bona fide certifiable digital money making machine. Samsung isn’t losing money, but profits are dropping like a rock and the company estimates that’s likely to continue for awhile.
Why? What happened?
Samsung gambled and kinda sorta mostly lost. Nobody sells more smartphones than Samsung, but Apple sells far less and makes far more money. Samsung failed to hook itself to Apple’s premium market segment star, so the company’s Galaxy class plastic gadgets have had their margins chewed on by Chinese smartphone makers with cheaper devices that pretty much look and fell like a Samsung device, run most of the same apps, so why bother to spend more. Samsung tried to take the high road of premium devices to compete with Apple (that’s where the profits live; the high road), got burned, fell down, then got ran over by all the makers of cheaper smartphones in China.
Karma’s a bitch, huh, Samsung?
What’s Samsung’s outlook for the future? Grim. Less than grim. Grimmer.
Apple’s iPhone CPUs have been manufactured by Samsung. That business is going away. Apple’s iPhone screens have been manufactured by Samsung. That business is going away, too.
To be fair about it, Samsung is still the world’s second most profitable smartphone and tablet maker (Guess who is Numero Uno?) but things are looking down while things for Apple are looking up.
And to think it all started with a hug.