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By Kim Yoo-chul
Samsung Electronics plans to cut its smartphone shipments next year by more than 12 percent from a year earlier, officials from the company's local partners said Monday.
"I was told that Samsung plans to cut smartphone shipments by as much as 12 percent," said an official at one of Samsung's local partners.
He said the decision doesn't necessarily mean that Samsung will be restructuring its handset business as maintaining a certain annual shipment helps the company maintain its global market share.
Its market share was 20 percent last year, followed by Apple and Chinese companies.
Another official said a 12 percent cut means Samsung will manufacture between 420 million and 430 million handsets.
"This is more about adjustments to changing market environment," said the official.
Of the total annual shipments, Samsung's plant in Vietnam was taking up more than half.
Samsung's focus next year will be budget phones of which demand is rising abroad.
In the third quarter, Samsung shipped 105 million phones, of which market research firms and officials estimate 85 million were smartphones.
"The mid-end A-series and low-end J-Series posted a strong shipment growth. We had doubts that Samsung had a competitive advantage in this mid- and low-end segment, but the actual volume was a surprise," said Bernstein Research in a research note.
Samsung plans to unveil its new Galaxy S7 early next year, possibly during the mobile expo in Barcelona.
"The S7 will also be available with an edge model, because the curved models are receiving a better response. With its display affiliate of Samsung Display improving production yields of curved mobile panels, S7 sales prospects seem solid and this will help Samsung maintain its global share next year," another official said.
