Its distributors now own a large portion of that huge inventory. Not enough people are interested in these phones, which are sitting on the shelves.
Mid-range smartphones are said to make up the majority of this stockpiled inventory, presumably because they aren’t compelling enough to sell quickly.
As of this year, Samsung expects to ship a total of 270 million smartphones, with 50 million representing 18% of that total. Since “healthy” stock counts are at or below 10%, this report’s sources say that these stored devices have a desirability problem.
In the beginning of the year, Samsung was producing around 20 million units a month, but in May that figure decreased to roughly 10 million. It’s possible that this is a reaction to low demand and an abundance of unsold apartments. Additionally, Samsung dropped component orders from suppliers by 30% to 70% between April and May because of the weaker demand.