Reuters claimed that it was all because the Galaxy S9 device missed sales targets and Samsung had lost its leadership of the smartphone market.

There is no doubt that the high-end smartphone market is taking a kicking but Apple is also suffering. Both made the mistake of thinking that high-margin high-price phones were the way forward. However, the rest of the world thought that paying more than $800 for a phone was insane and went to cheaper Chinese options.

However Samsung said operating profit from the mobile business recorded its steepest rate of decline since the first quarter of 2017 and it gave investors little reason to hope for a quick turnaround in the mobile business, flagging stiffer competition in the second half amid concerns its premium phones lack innovation to drive sales growth.

Higher marketing expenses and the disappointing performance of the flagship S9 smartphone, which fell short of its sales target, weighed on its mobile performance, Samsung said.

Samsung is pinning its hopes on foldable phones to become the next big thing. Its screen manufacturing unit said last week its unbreakable, bendable screen had passed US safety testing, a key step towards bringing foldable phones to market.

KyeongTae Lee, vice president of Samsung’s mobile business, told analysts: “We are hoping that such adoption will serve as a catalyst in the stagnated mobile market.”

Samsung said competition would intensify in the second half as new smartphone models were released, prompting it to introduce a new Galaxy Note earlier than usual. Samsung is scheduled to launch a new Note early next month.

The mobile business booked a 34 percent fall in operating profit to $2.4 billion in the second quarter, its biggest decline since the Galaxy S7 was Samsung’s flagship model early last year.