Samsung confirmed it's doubling down on 5G smartphones in hope that they'll help soften the impact of a full-fledged mobile crisis that's now looming over its business. That's not exactly a development many expected to witness at this point last year, but it does well to underline how unusual Samsung's latest financial report was. Especially given how the company's Q1 numbers are far from horrific.
On the contrary, even as many of its top markets began shutting down in response to the novel coronavirus pandemic, Samsung managed to marginally improve the profitability of its smartphone business over the first three months of 2020. That achievement is all the more remarkable in the context of a significant revenue hit Samsung would have taken in the first quarter regardless.
Samsung hoping 5G is ready to go mainstream
After all, post-holiday consumer electronics sales have nowhere to go but down, so negating their traditional effects on one's bottom line is a commendable feat even without the added challenge of a highly contagious disease threatening both their suppliers and customers.
But the COVID-19 lockdowns only started near the end of Samsung's newly reported quarter, which essentially guarantees the worst is yet to come for still the world's largest smartphone maker. True to reports from mid-April, company officials today confirmed Samsung will be refocusing on cheap 5G smartphones in the hope of combating the inevitable Q2 sales hit. Well, “cheap” relative to the only 5G-enabled devices Samsung released so far.
Realistically speaking, there's no doubt whether the likes of the Galaxy A51 5G and Galaxy A71 5G can make up for the many setbacks Samsung faces in the coming months – they can't. All that remains to be seen is in how bad of a shape will the company's smartphone business be come July.
