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The initial enthusiasm for the AI capabilities of Samsung Electronics (OTC:SSNLF) Galaxy S24 appears to be dwindling, as shipment momentum has slowed since April, six months after its launch.
What Happened: On Monday, Ming-Chi Kuo, an analyst at TF Securities, took to X, formerly Twitter, and revealed that Galaxy S24 initially experienced robust demand due to its AI features. However, the shipment rate has been slowing since April 2024.
The company’s new foldable models, the Z Fold 6 and Z Flip 6, which also feature AI, saw a 10% YoY decrease in pre-orders in July 2024, he stated.
The total shipments of Samsung’s foldable phones this year are projected to be around eight to nine million units, a slight decrease from the previous year.
“Based on current projections, the S25 series in 2025 could see shipments similar to the S24 in 2024,” Kuo stated.
See Also: ‘I’m Not Proud Of Myself’: Jim Cramer Says He Bought ‘Worst Of The Three’ GE Stocks
However, according to Kuo, despite the slowdown, the adoption of AI services by smartphone brands is expected to continue.
He went on to say that there is no solid proof that the continuous enhancements to on-device AI services by Alphbaet Inc.’s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google and Samsung will trigger another wave of device replacement demand.
Google began rolling out its first-ever AI Core update in November last year, specifically targeting the Pixel 8 Pro smartphone. Last month, the tech giant teased upcoming Pixel 9 flagship smartphones, indicating that AI and Gemini will be key features of the device
Lower-than-expected shipments of Android foldable phones, including Samsung and Chinese brands, suggest that growth in this segment may be limited in the near term unless there is a significant improvement in user experience, the analyst noted.
Kuo said that while some people remain hopeful about the increase in smartphone shipments driven by on-device AI if Apple Inc.’s (NASDAQ:AAPL) iPhone 16 series doesn’t meet expectations, this optimism could be adjusted.
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Why It Matters: Kuo’s latest assessment comes a day after Bloomberg columnist Mark Gurman said that he doesn’t expect, Apple’s upcoming smartphone models, the iPhone 16 series, to “fuel a gold rush.”
He noted that the tech giant’s financial guidance also suggests that Apple doesn’t have this expectation either.
Meanwhile, Apple shares have rebounded well amid expectations that iPhone demand will increase following the launch of the next generation of its flagship device.
According to Wedbush analyst Daniel Ives, all indications suggest a strong reception for the latest iPhone upon its release.
Photo courtesy: Samsung
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
