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Samsung sees $12B market value blow over Galaxy S4 concerns

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Is Samsung’s golden smartphone era coming to an end?

Samsung’s stock lost $12 billion worth of market value (after falling around 6 percent) in South Korea Friday due to brokerage downgrades, mostly related to concerns that sales of its Galaxy S4 smartphone are slowing down, Reuters reports.

Samsung’s Galaxy S smartphones have been a smashing success for the past few years — and notably, Samsung’s the only Android manufacturer that’s making a significant profit. After the insane sales of the Galaxy S III (which sold more than 30 million units as of March), any slowdown with the Galaxy S4’s sales could be a huge problem for the company.

Samsung’s issues are similar to what Apple has faced recently — after years of consistently rising sales and profits, the market has a tough time handling any sort of slow down.

Among the brokerage beating, Morgan Stanley reduced its earnings estimates after reporting that Galaxy S4 orders were cut by 20 to 30 percent in July due to lower demand in Europe and South Korea. Woori Securities lowered Samsung’s target price by 4.8 percent and also reduced the company’s earnings per share forecasts for 2013 by 9.2 percent and 11.7 percent respectively.

Samsung also faces criticism from analysts over its lower-end Galaxy S4 models, like the Galaxy S4 mini. While there’s definitely a need for lower-end smartphones, they won’t have the same high margins as Samsung’s more expensive offerings.

Photo: Devindra Hardawar/VentureBeat