Waiting for the Next Samsung Foldable?
While Samsung Electronics (005930.KS), might not have been the first to release a foldable device, they certainly have been the category’s biggest proponent. With the company expected to release its 3rd generation foldable series next month, there is little about the Z4 line that is not already known, other than price, although speculation is that both models will remain at the same price as the previous iteration. That said, what about the Galaxy Fold 5 and Flip 5, which will not be released for over a year? Yes, there is already the beginnings of conjecture about that next generation of foldable smartphones, even before the previous version is out.
The Galaxy Fold 5 and Flip 5 are expected to be based on Qualcomm’s (QCOM) Snapdragon 8550 chipset (aka Snapdragon 8 Gen 2), a 4um node device produced by Taiwan Semi (TSM) to be released later this year as an upgrade to the Snapdragon 8+ Gen 1, which was recently released. This has also brought on speculation that Samsung will no longer use its own Exynos processor in the foldables (and potentially other mobile devices) as the Snapdragon specs have bypassed those of the Exynos. But there is one aspect of the Flip/Fold 5 that is unusual, and that is Samsung’s unit volume targets, which are expected to be quite low and are seemingly reflecting a dour picture of the smartphone or CE environment in 2023.
As shown in the table below, we believe Samsung shipped 7.11m foldable units in 2021. Samsung originally set a target of 10m units for this year but increased that to 15m units earlier this year. Thus far we have not heard that the target for this year has changed, and, if the release date of August is correct, production of those units has been underway since late May or early June, especially considering the difficulties associated with shipping that CE companies are currently facing. As production for the Galaxy Fold/Flip will continue through the end of the year, there is stil time for Samsung to reduce the number of units once they see whether the macro environment is affecting foldable sales.
That said, the trade press in Korea is stating that Samsung has already set its unit volume targets for the Galaxy Fold/Flip Series 5, tobe released in August 2023, but at a considerably lower target (10m units) than one might expect given Samsung’s hopes for growth in the foldable smartphone category. This could be a reflection of Samsung’s 2023 macro outlook or more likely in our view, a very conservative estimate that will likely be raised, a more positive timeline than one where targets have to be reduced. We note also that the ratio between the two models in both 2021 and 2022 has been 3:7, while in 2023, it is 1:4, according to the same sources. This implies that the Galaxy Flip 5 will see an increase in unit proportion against the more expensive Galaxy Z Fold 5.
Again, without confirmation from Samsung, we expect this would reflect an anticipated decline in price for the Galaxy Z Flip, which would increase its customer base, while the Galaxy Z Fold remains near or at its current levels to preserve margins across the entire foldable smartphone line. This also does not assume that Samsung will release any new foldable smartphone models, which we believe is certainly a possibility in 2023, so the speculation of over the Z Flip and Fold targets could be excluding other models that would bring the targets up to what would be more ‘growthy’ levels, especially as Samsung has stated that it expects to expand the foldable line over time.
The Galaxy Fold 5 and Flip 5 are expected to be based on Qualcomm’s (QCOM) Snapdragon 8550 chipset (aka Snapdragon 8 Gen 2), a 4um node device produced by Taiwan Semi (TSM) to be released later this year as an upgrade to the Snapdragon 8+ Gen 1, which was recently released. This has also brought on speculation that Samsung will no longer use its own Exynos processor in the foldables (and potentially other mobile devices) as the Snapdragon specs have bypassed those of the Exynos. But there is one aspect of the Flip/Fold 5 that is unusual, and that is Samsung’s unit volume targets, which are expected to be quite low and are seemingly reflecting a dour picture of the smartphone or CE environment in 2023.
As shown in the table below, we believe Samsung shipped 7.11m foldable units in 2021. Samsung originally set a target of 10m units for this year but increased that to 15m units earlier this year. Thus far we have not heard that the target for this year has changed, and, if the release date of August is correct, production of those units has been underway since late May or early June, especially considering the difficulties associated with shipping that CE companies are currently facing. As production for the Galaxy Fold/Flip will continue through the end of the year, there is stil time for Samsung to reduce the number of units once they see whether the macro environment is affecting foldable sales.
That said, the trade press in Korea is stating that Samsung has already set its unit volume targets for the Galaxy Fold/Flip Series 5, tobe released in August 2023, but at a considerably lower target (10m units) than one might expect given Samsung’s hopes for growth in the foldable smartphone category. This could be a reflection of Samsung’s 2023 macro outlook or more likely in our view, a very conservative estimate that will likely be raised, a more positive timeline than one where targets have to be reduced. We note also that the ratio between the two models in both 2021 and 2022 has been 3:7, while in 2023, it is 1:4, according to the same sources. This implies that the Galaxy Flip 5 will see an increase in unit proportion against the more expensive Galaxy Z Fold 5.
Again, without confirmation from Samsung, we expect this would reflect an anticipated decline in price for the Galaxy Z Flip, which would increase its customer base, while the Galaxy Z Fold remains near or at its current levels to preserve margins across the entire foldable smartphone line. This also does not assume that Samsung will release any new foldable smartphone models, which we believe is certainly a possibility in 2023, so the speculation of over the Z Flip and Fold targets could be excluding other models that would bring the targets up to what would be more ‘growthy’ levels, especially as Samsung has stated that it expects to expand the foldable line over time.
RSS Feed