Samsung Aims to Dominate AI Smartphones with New Foldable Designs

Looking to regain its edge in the smartphone market, **Samsung Electronics** has launched new, slimmer foldable phones, directly challenging Chinese competitors and aiming to outpace **Apple** in the premium sector.

New Foldables Unveiled

On July 9th, **Samsung** revealed its latest foldable phones, engineered to be lighter and thinner. The company hopes these new designs will help it compete with rivals such as **Huawei** and **Honor**, particularly in the high-end market.

AI Integration is Key

**Mr. Choi Won-joon**, **Samsung’s** mobile president and COO, emphasized the importance of leading in AI-powered smartphones. He believes that foldable phones with integrated AI can become mainstream by providing unique user experiences.

According to **Choi**, **Samsung** plans to lead in AI technology through collaborations with partners like **Google**, contrasting with **Apple’s** approach of relying on in-house AI development.

Smartwatches Enhanced with Google AI

**Samsung** also introduced smartwatches featuring **Google’s** Gemini AI voice assistant in New York. Gemini can offer personalized recommendations, such as suggesting optimal running locations.

Pricing Strategy

**Samsung** is pursuing a premium product strategy, reflected in the increased US price of the Galaxy Z Fold 7, which now costs $1,999, a 5% increase from the Fold 6. A more affordable version of the Galaxy Z Flip 7, the Flip 7 FE, is priced at $899.

The Galaxy Z Fold 7 uses **Qualcomm’s** Snapdragon 8 Elite processor, while the Galaxy Z Flip 7 is powered by **Samsung’s** Exynos chips.

Analysts’ Take

Analysts suggest the new models address some of the issues associated with foldable phones, like bulkiness, enhancing the brand’s premium image. The Galaxy Z Fold 7 is 10% lighter and 26% thinner than its predecessor.

However, due to high prices and limited practical applications, foldable phones are predicted to remain a niche market, accounting for only 1.5% of the total smartphone market, according to IDC data.

Market Trends and Competition

Canalys predicts that **Samsung’s** foldable shipments will remain stable or slightly decline in 2025, mirroring the broader market’s growth. Although foldable smartphones represent 4% of **Samsung’s** total phone sales, they account for 16% of sales priced above $800.

Data indicates that **Samsung’s** dominance in the foldable phone segment is diminishing due to strong sales from **Honor** and **Huawei**, especially in China.

**Samsung** will concentrate on the United States, Europe, and South Korea for foldable phone sales, according to **Mr. Choi**. The company is also actively developing tri-foldable phones, though a launch date remains undisclosed.

Mitigating External Challenges

**Mr. Choi** mentioned that **Samsung** has accelerated smartphone output and shipments to the US to lessen the impact of potential US tariffs. **Samsung** manufactures its smartphones primarily in Vietnam, which accounts for over half of its production, along with facilities in South Korea and India.

Furthermore, **Samsung** is addressing China’s export restrictions on rare earth elements by diversifying its supplier base and increasing its internal stockpiles. According to a recent report by the U.S. Geological Survey, China accounts for roughly 70% of global rare earth element production (USGS 2024).