KGI Securities Analyst Ming-Chi Kuo has been spot on with Apple predictions over the last several years and this has earned him the name of “The Most Accurate Apple Analyst in the World”. This weekend, he has come up with a new investor report which almost focuses entirely in the Samsung Galaxy S8.
Ming-Chi Kuo believes that Samsung Galaxy S8 will see weaker demands than its predecessor. There are a couple of reasons for this. The first reason for this is attributed to the Galaxy Note 7 debacle, which caused the Samsung Galaxy S7 to be the only Samsung flagship of 2016. The next reason for the claim is that Samsung will face stiff competition from Apple which is expected to be bigger than ever.
Kuo claims that the Samsung Galaxy S8 lacks “sufficiently attractive selling points” and thus the iPhone 8(the flagship model with the OLED display) will sell a lot more than the iPhone 7 and 7 Plus did last year.
Because of the release of the “special-edition iPhone” this year, Kuo believes that the Samsung Galaxy S8 will have minimal impact on the supply chain and that the iPhone 8 will have a much more significant impact.
Here is an excerpt from the report:
We project Galaxy S8 shipments of 40-45mn units in 2017F, implying slower momentum compared to Galaxy S7 in 2016 (around 52mn units shipped), attributable to: (1) a one-month difference in comparable sales period;
(2) Galaxy S7 was Samsung’s main promotional flagship model in 4Q16 after termination of Galaxy Note 7 due to the battery explosion issue, hence the higher sales base;
(3) as Galaxy S8 lacks sufficiently attractive selling points (except full-screen design), the OLED iPhone could well be a bigger draw for consumers.
We are conservative on demand for Galaxy S8, and believe its contribution to the supply chain will be limited. Instead we recommend focusing on the sales outlook and supply chain momentum of Apple’s (US) OLED iPhone model.
It is worthy to note that the Samsung Galaxy S8 is expected to sport a similar design to that of the iPhone 8. The interesting question is whether Samsung still has the same fan base like it had before the Note 7 explosion issue.
Stay tuned for more!