From The Motley Fool
Earlier in June, the South Korean consumer electronics behemoth Samsung Electronics (NASDAQOTH: SSNLF) shed $12 billion in market cap after several analyst downgrades due to fears regarding the slowdown in sales of its Galaxy S4 smartphone.
Unlike Apple, Samsung manufactures a large variety of phones, of which the low-end ones have been doing great around the world, effectively fending off competition from the Chinese rivals, but the growth of its higher margin high end smartphone -- the Galaxy S series -- has been waning. The brisk growth of the lower margin operation could eventually drag Samsung’s profitability lower.
The fears were confirmed in its second quarter results which came in below estimates (that led to even more downgrades), but the company is now eyeing growth in the lucrative storage devices industry that is expected to grow rapidly in the coming years.
