: Samsung holds prices on Galaxy smartphones amid inflation, slumping market
Samsung Electronics Co. Ltd. on Wednesday unveiled three new smartphones with advanced cameras, enhanced productivity and more powerful batteries and storage — at comparable prices from a year ago.
The new Galaxy S23 series is priced from $799 to $1,199, the same range as the S22 lineup launched last year, and features a 200-megapixel camera and 6.8-inch screen. The three models can also seamlessly connect to Samsung’s new Galaxy Book3 Series personal computers, with the touch-screen PCs operable as a second screen for the phones. The Galaxy Book3 Series lineup is priced from $999 to $2,399.
The kitchen-sink approach to Samsung’s annual Galaxy launch comes amid a device recession, and after Apple Inc.
also maintained its prices on its latest round of new iPhones. Smartphone shipments endured a decline of 11% or more last year, according to third-party analyses, with Gartner predicting another 4% decline in 2023.
which introduced the products Wednesday at a press conference in San Francisco, said it is taking smartphone preorders on Feb. 1, and the phones will be available on Feb. 17. Samsung plans a marketing blitz with national TV ads and promotions from partners such as Verizon Communications Inc.
and Best Buy Co.
AT&T is offering $1,000 off the new Samsung Galaxy S23 series and a free memory upgrade with preorders.
“Our value bucket is keeping prices the same, but with more memory, battery and camera,” Jude Buckley, executive vice president of U.S. mobile business at Samsung Electronics America, told MarketWatch ahead of the event. Despite a downturn in smartphone shipments, Buckley sees companies settling into a hybrid work environment that requires employees to use interconnected devices with better screens and cameras.
While improvements to the S23 are the kind of incremental enhancements that consumers and analysts have come to expect in the smartphone market, Samsung’s pricing strategy is an acknowledgment of a market that requires lower-cost smartphones to spur consumer sales. Rapid inflation worldwide has forced consumers to focus more of their budgets on necessities, leading to longer waits to refresh electronic devices.
For more: The world is buying fewer devices, and inventories for PCs, phones and tablets are building
“By holding the line on its smartphone prices, despite raising component costs and improved storage configurations, Samsung is clearly trying to demonstrate a willingness to be aggressive on pricing,” Bob O’Donnell, chief analyst at TECHnalysis Research, told MarketWatch. “Of course, as with PCs, it’s a tough time for the smartphone market, so Samsung needs to keep themselves competitive.”
That competitive pricing is impacting the South Korean electronics giant’s bottom line, though. Samsung’s quarterly profits plunged to their lowest level in eight years, down 69% year-over-year to $3.5 billion, in holiday-quarter results released Tuesday.
The company’s first in-person smartphone launch in three years has run smack dab into an industrywide slowdown as penny-pinching consumers hang on to their devices longer and are unwilling to pay premium prices for new models.
Smartphone shipments are forecast to decline worldwide 4% to 1.34 billion units in 2023, according to Gartner. Canalys’ latest research, meanwhile, showed smartphone shipments plummeted 18% to 296.9 million units in the last three months of 2022.
Read more: Apple couldn’t save the smartphone industry from its worst year since 2013
Smartphone vendors shipped 1.21 billion units last year, a decline of 11% and the lowest output since 2013, according to market researcher IDC.
IDC said the 292.3 million PC units shipped in 2022 were “well above prepandemic levels,” but smartphones fell to their worst count since Apple’s iPhone 5 was the new phone on the market.