[June 25, KOREA WAVE]Samsung Electronics’ home appliance (DA) division has decided to focus on securing cost competitiveness. This is because sales and profitability have been declining despite the company’s focus on marketing artificial intelligence (AI) home appliances. This was discussed at a global strategy meeting for Samsung Electronics’ DA and image display (VD) divisions held on the 19th.
Samsung Electronics’ Digital Transformation (DX) division held a division-specific strategy meeting from the 18th to the 20th to review the company’s business performance in the first half of the year and formulated strategies for the second half of the year.
The DA division meeting was reportedly held in a somewhat heavy atmosphere. Samsung Electronics Vice Chairman Han Jeong-hee took over as head of the DA division last year and has attempted to improve the business structure, but performance remained sluggish in the first half of this year. It is said that the company also failed to meet its monthly sales targets.
Samsung Electronics’ DX division recorded sales of 47.29 trillion won and operating profits of 4.07 trillion won in the first quarter of this year. The DA division reportedly made a small profit in the first quarter, but according to an analysis by the securities industry, the majority of the sales and operating profits came from the Mobile Experience (MX) and VD divisions. The DA division’s sales in the first quarter were reportedly down about 10%.
The DA division is likely to post a loss in the second quarter, and is expected to post a loss for the first half of the year as well. Samsung Electronics has seen strong sales of AI home appliances, but is struggling with general home appliances. This information was reportedly shared at the strategy meeting.
In response, the DA division concluded that it needed to strengthen its cost competitiveness as demand for home appliance replacements has decreased due to the economic downturn. Specifically, it considered increasing outsourcing to China and reducing options for product designs and colors.
(c)news1/KOREA WAVE/AFPBB News
Source: Japanese