Samsung unveils new Galaxy S22 smartphones at unpacked occasion, retains outdated costs

In the trade’s first main launch of the yr, Samsung Electronics Co. launched three variations of its flagship Galaxy S22 units on Wednesday. The costs stay the identical as final yr: the bottom mannequin will retail for $800, whereas the bigger Galaxy S22+ will price $1,000. The top-of-the-line Galaxy S22 Ultra, that includes a 6.8-inch display screen and an “S Pen” stylus, is priced at $1,200.

Prices world-wide are rising at their quickest charges in a long time as the prices of uncooked supplies, parts and transport surge. Roh Tae-moon, president of Samsung’s cellular enterprise division, stated he’s prepared to abdomen the additional prices to woo a wider vary of consumers, following a yr of sluggish cargo progress for the South Korean tech large.

“The pricing was a strategic resolution,” Mr. Roh said. “Our top priority was to ensure that our consumers feel our devices are affordable and accessible.”

The world smartphone trade flickered again to life in 2021, displaying annual progress for the primary time in 4 years. World-wide smartphone shipments nudged up 4% to 1.4 billion items final yr, although remained beneath pre-pandemic ranges, in accordance with Counterpoint Research, a tech-market researcher. Component shortages stymied what may have been a stronger yr.

It wasn’t way back that Samsung and Apple Inc.—the 2 dominant gamers within the premium smartphone market—lifted the bottom costs of their flagship units to $1,000. Some prospects have paid the massive bucks for the units, although the mass market has most popular a lower cost tag. Users are holding on to their present units longer, too.

Apple saved the worth of its iPhone 13 the identical because the prior yr’s mannequin at $800, a transfer that trade analysts say helped the corporate drive document gross sales and earnings within the last months of final yr. Samsung additionally noticed a lift to final yr’s Galaxy S21 shipments after flattening the worth by $200.

Staying placed on pricing, regardless of revenue pressures attributable to key materials prices growing, caters to a wider viewers and will woo some consumers hesitant to improve, stated Tom Kang, a Seoul-based analysis director at Counterpoint. Not pricing aggressively above the prior yr’s mannequin or the chief competitors eases the acquisition resolution, he stated.

Not all cellphone makers have the monetary clout or branding to carry off on value will increase. The common wholesale value for smartphones has risen by 2% or much less in recent times. But through the first three quarters of 2021, the costs rose 10% from the prior yr, in accordance with Strategy Analytics, a market analysis agency. They are anticipated to rise once more this yr by 5%.

This displays the differing ranges of wiggle room, with Apple and Samsung having cushier revenue margins of 30% to 40%, whereas midtier or finances gamers, like Xiaomi Corp., taking markups usually of 10% or much less, stated Wayne Lam, director of analysis at CCS Insight, a know-how advisory agency.

“The marketplace for smartphones has consolidated into the ‘haves’ and ‘have nots’ through the years,” Mr. Lam stated.

The trio of Galaxy S22 telephones boasts a extra highly effective processor, quicker charging instances and cameras higher geared up to take pictures and movies in lowlight settings. The high line Galaxy S22 Ultra packs in probably the most superior digicam applied sciences. The base mannequin has a show that measures 6.1 inches diagonally, whereas the Galaxy S22+ is available in at 6.6 inches. The telephones hit cabinets within the U.S., South Korea and Europe on Feb. 25.

“It’s the standard modifications—quicker processors, higher cameras. In that sense, it’s extra of an incremental improve than something revolutionary,” stated Bryan Ma, vp of units analysis at International Data Corp.

The South Korean firm additionally unveiled three variations of its new Galaxy Tab S8 tablets through the Wednesday launch occasion.

Samsung is anticipated to promote roughly 30 million items of the Galaxy S22 units this yr, in accordance with Counterpoint forecasts, assuming the present chipset shortages don’t unexpectedly worsen. It could be an enchancment from the roughly 28 million items offered of the prior yr’s mannequin.

Annual smartphone shipments globally are forecast to rise 7% in 2022 from the prior yr to round 1.5 billion items, with 5G serving to drive gross sales throughout all value ranges, in accordance with Counterpoint. That would surpass pre-pandemic ranges.

Samsung’s cellular division had a rocky yr. When chip shortages have been acute final fall, the corporate’s third-quarter smartphone shipments fell by 14% from the prior yr, in accordance with Counterpoint. A extra inexpensive model of its Galaxy S21, which was anticipated to launch in the course of 2021, solely turned out there final month.

After a yr of supply-chain challenges, Mr. Roh, the Samsung cellular enterprise chief, stated the corporate is in a greater place now. For occasion, it’s hanging longer-term contracts with element suppliers that decide to orders additional out prematurely and optimizing transport routes.

“Amid uncertainties, we realized we wanted these modifications,” Mr. Roh stated.

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