Samsung (NASDAQOTH:SSNLF) is gearing up for the release of its Galaxy S5 next month, but will the smartphone be ready? Recent reports indicate that Samsung has yet to begin mass producing the S5 due to manufacturing issues, which could hurt the company and its shareholders.
Many tech consumers are eager to get their hands on the S5, scheduled to reach stores on April 11. But, manufacturing issues involving the smartphone's camera could cause the device's release date to be pushed back, and may damage Samsung's stock as well.
Why could the S5's release date be delayed?
The S5 could make or break Samsung. If the device reaches stores on time, it could be popular with tech consumers searching for the latest and greatest smartphone. However, a shipping delay could damage Samsung's global reputation and create opportunities for competitors like Apple (NASDAQ:AAPL) and Nokia (NYSE:NOK).
Samsung promises faster downloads and more features from the S5. This smartphone features a fingerprint sensor, heart rate monitor, and improved battery life, which could help it garner attention from global audiences.
Samsung officials anticipate that the company will begin accepting pre-orders for the S5 on March 28. But, competition among smartphone manufacturers remains fierce and could make it difficult for Samsung to fully recover if the company needs to delay the S5's release.
Apple and Nokia are looming
Apple is currently the leader among smartphone manufacturers, and several tech experts have reported that Apple holds about 60% of the market. With today's announcement of a cheaper iPhone 5c, Apple could significantly boost its profits in the near future. A delayed S5 release would further increase the gap between Apple and Samsung, and might even turn off some smartphone shoppers from Samsung for good.
Nokia, meanwhile, recently unveiled new smartphones that operate on the Nokia X software platform. These devices are cheaper alternatives to many smartphones on the market and feature innovative tools that could make them popular for consumers across the globe.
"Today, Windows Phone is the fastest growing mobile ecosystem in the world, and we continue to see incredible momentum with our Lumia smartphones," said Bryan Biniak, vice president and general manager of developer experience at Nokia. "Now, with the introduction of the Nokia X family of devices, we're delivering the same design, quality and innovation. Nokia is known to lower price points to capture the fastest-growing segment of the smartphone market."
While Samsung is one of the global leaders among smartphone manufacturers, Nokia's latest offerings put even more pressure on Samsung to perform. If the S5 is delayed, Nokia, like Apple, could profit from tech consumers searching for viable alternatives to Samsung products.
How can Samsung increase its profits this year?
Samsung should have a better idea about consumers' expectations for the S5 when it starts taking pre-orders for the device. In the meantime, however, Samsung needs to stay on track for its April 11 release, or risk alienating many consumers. If the S5 meets or exceeds consumers' expectations and tech experts' predictions, Samsung could significantly bolster profits in 2014.
Daniel Kobialka has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.