For the month of August, Samsung has reportedly suffered a $12 billion loss, the biggest chunk so far in the collective $44 billion market value lost since April due to stock selloff. This is the company's worst streak since 1983, according to a Bloomberg report.
While Samsung's market performance has been adversely affected by declining profit, the economic uncertainty in China appears to have precipitated the drastic drop in value for the month of August. Presently, China is in the middle of a stock market crash that has prompted many companies to voluntarily stop trading their shares while the government has arrested hundreds, including traders and journalists, Mashable reported.
China is an important smartphone market and a decline in demand could significantly impact Samsung's sales.
There is also an increasing market saturation in China as more and more smartphone manufacturers introduce new and cheaper devices. This is demonstrated in the way Samsung smartphone shipments in the country have declined by as much as 50 percent, IDC reported. Interestingly, the same can not be said about Apple.
"I can tell you that we have continued to experience strong growth for our business in China through July and August," Apple CEO Tim Cook said, according to Mashable.
The Chinese economic slowdown is also expected to affect the broader global economy. It is premature to predict whether this will have a bearing on Samsung's global performance. However, it is clear that the company is struggling as it is assailed by competition from all angles and a potential global economic downturn could further dampen consumer demand.
