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Samsung’s electronics sales decline in China, Europe for third consecutive year

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Jessica Lee Star/Digital Trends

Samsung may be the world’s second-largest phone maker, but the South Korean outfit continues its struggles in Europe and China, ZDNet reports.

According to Samsung’s 2016 Sustainability Management Report, a yearly report that highlights how it is performing, the company’s revenues from electronics sold in the U.S. continue to increase, with the proportion relative to its worldwide operations increasing from 30 percent in 2013 to 33 percent in 2014, to 34 percent in 2015. In terms of revenue, sales in the U.S. amounted to 68.9 trillion won ($60.2 billion) in 2015, making the country the top source of annual revenue in terms of electronics sales.

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Things are not as bright when it comes to other regions, with European sales continuing to decline since 2013 to 38.6 trillion won ($33.5 billion) in 2015. In other words, the European proportion of worldwide revenue decreased from 23 percent in 2013 to 21 percent in 2014, to 19 percent in 2015.

Finally, electronics sales in China decreased from 40.1 trillion won ($34.9 billion) in 2013 to 33 trillion won ($28.6 billion) in 2014, to 31 trillion won ($26.8 billion) in 2015. Because of the decreases, Samsung’s Chinese proportion of worldwide revenue dropped from 18 percent in 2013 to 15 percent in 2015.

Unfortunately for Samsung, the likes of Huawei, Xiaomi, and Oppo have made things difficult for the South Korean company in Europe and China, the latter in particular. Entering 2013, Samsung was the top phone manufacturer in China, though that position is now occupied by Huawei, with Xiaomi a close second.

Samsung has taken steps to try and at least right its Chinese ship. For one, the company will reportedly increase its profit margins by minimizing the number of marketing campaigns and budget phones. Furthermore, Samsung began creating region-specific phones like the Galaxy C4, which checks the right boxes, such as a Snapdragon 617 processor with 4GB RAM, ample native storage, and a fingerprint scanner.

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However, it does not help that Huawei and Xiaomi continue to churn out low-priced phones that more than compete with what Samsung has to offer in the high-end, offerings that tend to be quite expensive. In addition, Brexit might force Samsung to close its London offices, further pushing the company away from Europe.