The initial excitement surrounding the AI capabilities of Samsung’s Galaxy S24 seems to be cooling off. According to Ming-Chi Kuo, an analyst at TF Securities, the Galaxy S24 saw strong demand early on due to its AI features. However, shipments have slowed down since April, six months after its launch. This trend extends to Samsung’s foldable models, the Z Fold 6 and Z Flip 6, which also feature AI. These devices saw a 10% year-over-year decrease in pre-orders in July 2024.
The overall picture suggests that the growth of on-device AI might be encountering roadblocks. Samsung’s total foldable phone shipments for this year are projected to be around eight to nine million units, a slight decline from the previous year. Kuo predicts that the upcoming S25 series in 2025 could see similar shipment numbers to the S24 in 2024.
Despite this slowdown, Kuo believes that smartphone brands will continue to integrate AI services. However, he remains uncertain whether continuous enhancements to on-device AI services by Google and Samsung will trigger a new wave of device upgrades. Google launched its first AI Core update last November, specifically for the Pixel 8 Pro smartphone, and has teased the upcoming Pixel 9 flagship, highlighting AI and Gemini as key features.
Lower-than-expected shipments of Android foldable phones, including those from Samsung and Chinese brands, indicate that the growth of this segment might be limited in the near term. This is unless there are significant improvements in user experience. Kuo suggests that the optimism surrounding on-device AI driving smartphone shipments could be tempered, particularly if Apple’s iPhone 16 series fails to meet expectations.
This analysis comes after Bloomberg columnist Mark Gurman expressed doubts about the iPhone 16 series fueling a ‘gold rush.’ Apple’s financial guidance seems to echo this sentiment. Meanwhile, Apple shares have risen on expectations of increased iPhone demand following the launch of the next generation of its flagship device. Wedbush analyst Daniel Ives believes that the new iPhone will be well-received upon its release.
