Key Points
- Samsung plans to lay off up to 30% of employees in certain divisions globally, which will affect sales, marketing, and administrative roles.
- The layoffs will affect staff across Samsung’s operations in the Americas, Europe, Asia, and Africa, with significant cuts in China and India.
- Despite being profitable, Samsung faces financial struggles, with declining operating profits and recent cost-cutting measures.
- Samsung aims to revamp its semiconductor business amid financial difficulties, replacing its chief chip executive in May.
According to sources familiar with the matter, Samsung, headquartered in South Korea, is set to lay off up to 30% of its employees in some divisions by the end of the year. The layoffs will affect various departments worldwide, including significant cuts in sales, marketing, and administrative roles.
The tech giant plans to reduce its sales and marketing workforce by approximately 15%, which could impact over 3,700 of its 25,000 employees in these departments. Administrative staff cuts are expected to be more severe, with up to 30% of positions being eliminated. The layoffs will span Samsung’s operations across the Americas, Europe, Asia, and Africa, impacting numerous regions, including China and India, where up to 1,000 job losses are anticipated.
This round of layoffs is part of Samsung’s broader strategy to address what it describes as a financial “crisis,” despite remaining profitable. Samsung’s recent financial struggles have been marked by a substantial decline in operating profits from late 2022 through the end of 2023. The company posted $4.9 billion in operating profits last fiscal year but saw a 900% surge earlier this year, largely driven by increased chip demand linked to the global boom in artificial intelligence development.
Samsung replaced its chief chip executive in May to improve its semiconductor business. Despite these challenges, the company’s stock has performed relatively well, down about 8% in the past year but up nearly 38% over the last five years.
Samsung imposed six-day workweeks for its executives earlier this year in response to its financial challenges. Based on last year’s data, the company has nearly 270,000 employees across 76 countries. The company told Reuters that the layoffs are part of routine business operations to make the organization more efficient.
