Samsung Galaxy S20’s weak initial sale in its home turf reveals imminent coronavirus ripples
Coronavirus is hurting phone companies as Samsung just saw a big drop in early sales of its new Galaxy S20 series in South Korea.
Smartphone companies have been hit hard by the coronavirus outbreak mainly because of their dependence on China for manufacturing and supply. With the virus, also known as COVID-19, affecting more nations, the phone companies are having a hard time keeping up with their revenue projects. The latest to bear the brunt of the coronavirus is Samsung which has just seen a massive drop in initial sales of its new Galaxy S20 series in South Korea.
Samsung reportedly sold 70,800 units of the Galaxy S20 series phones on the first day of the launch. The figures are significantly lower than Samsung's first day sale figures of 140,000 units of Galaxy S10 in early 2019. S20's first day performance in South Korea is even worse than Galaxy Note 10's 220,000 units in August, 2019. Coronavirus scare is blamed as one of the reasons behind the bleak sales figures.
"Sales were affected by sharp declines in discounts for new phones and the number of visitors to offline stores due to coronavirus infection fears," a local telecom company official is quoted as saying.
It is worth noting that South Korea has also been affected by the coronavirus outbreak. According to a Reuters report, the country reported 376 new confirmed coronavirus cases, taking the total number to 3,526.
Samsung, however, will not be the only tech giant to face such problems. Apple has already warned that it was unlikely to meet the sales target amid lost production and waning demand in China due to the coronavirus outbreak. Unlike Samsung, Apple has China as one of its top markets. The country accounted roughly 15% of its total revenue in the previous quarter.
Microsoft has also warned of a similar weak sale of computers due to the virus scare. According to an IDC report, smartphone shipments in China are estimated to drop 40% in first quarter of the year.
"While our facilities in China have been delayed in their return to normal operations, our facilities in a number of other markets, including Vietnam, India and Mexico, are running at full capacity and expansion plans for some of our global facilities are being rolled out," said Foxconn which is also Apple's biggest manufacturing partner.