Samsung Electronics has issued an apology, acknowledging challenges in its technological competitiveness during the ongoing global AI boom.
The company expects its third-quarter profits to reach 9.1 trillion won ($6.8 billion), marking a 274.5% increase from the previous year.
However, this figure falls below market expectations.
Vice Chairman Jun Young-hyun of Samsung’s device solutions division expressed concerns about the company’s competitive edge and its future prospects.
Despite these worries, management is committed to overcoming the crisis and transforming it into an opportunity for resurgence.
Although profits have risen compared to the same period last year, they have declined by nearly 13% from the previous quarter. In response to these challenges, Samsung plans to cut staff in some Asian operations, potentially impacting 10-30% of its overseas workforce.
The company is also facing stiff competition from SK Hynix, its South Korean rival, in the high bandwidth memory (HBM) chips segment, crucial for AI chipsets.
Samsung has reportedly lost several HBM-related employees to SK Hynix, intensifying the competitive pressure.
Samsung’s shares have dropped 1.31% in Seoul and are down nearly 30% over the past six months.
To address these issues, management aims to quickly assess and adjust the company’s workplace culture.
Despite the challenges, Samsung projects a 17.2% increase in sales for the third quarter, estimating a total of 79 trillion won.
The final earnings report is expected at the end of the month.
