how many people really need a phone that can turn into a tablet?

Turns out, quite a few, especially if you do a lot of business and whatnot. A relative of mine has a folding phone and they appreciate having a much larger screen for reading PDFs, spreadsheets, etc. on the go. It also means they don't need to bring a large tablet everywhere, so they can get a 13" tablet (instead of a smaller size) just for home use and not need to worry about bringing it around on trips and such

Also of note, this is just Samsung jumping out of the game, but other companies like Motorola, Xiaomi, or similar could take the market of flip phones. For Samsung, their big fold phones are more profitable, but in contrast, those are less profitable for Motorola and Xiaomi (whose small fold phones have been much more popular compares to their bigger options)

I think both big screen and little guy folding phones have their place.