Galaxy S4 An Early Success As Shipments Top Estimates

April 5, 2013 - Written By Chance Miller

Samsung’s got a strong hold on the Android market. The company has proven that with the right tweaks, consumers will choose Android over iOS in a heart beat. In fact, yesterday, data showed that it was the only Android manufacturer to increase in market share during the last three months. The company’s success has even gotten to the point where no one doubts that its flagships will sell millions of units. Last month, Samsung took the stage and announced its latest hero device, the Galaxy S4. Even though it was a minor upgrade, no one doubted it would be successful, and according to one analyst, the device can already be declared a success.

Bernstein Research analyst Mark Newman released a report on Friday claiming that Samsung has already beat many early estimates when it comes to production rates and pre-orders with the Galaxy S4. Newman claims that the South Korean company is manufacturing the device at a rate of 10 million units a month, which beats the estimates made earlier by Bernstein Research. “Galaxy S4′s production rate of 10M units/month appears stronger than our projections despite some potential supply issues in March,” he claims.

Newman also notes that even though the Galaxy S4 is more expensive than the Galaxy S III to manufacture, Samsung should be able to keep the same margins. This is because many of the S4’s components are built by Samsung’s own component arms.

“We estimate that, while 53% of Galaxy S3 BOM cost was internal, 58% of Galaxy S4 BOM costs should now flow through Display/Semis (Memory & S.LSI),” Newman explained. “We estimate that, while 64% of Galaxy S3 BOM cost was within the Samsung Group (i.e. SEMCO, Samsung SDI, etc.), 68% of Galaxy S4 BOM costs should now flow through the Samsung Group. Additional profits to Samsung group entities should benefit Samsung Electronics in the form of increased equity income.” He went on to speculate that the Galaxy S4’s profit margin will be 46 percent, while the Galaxy S3’s was 48 percent. “We believe the Galaxy S4 positions Samsung Electronics for continued strong earnings growth this year,” Newman wrote.

Do you plan on picking up the Galaxy S4? Let us know down in the comments!