Samsung Electronics Co expects international economic growth to remain weak this year and urged employees to brainstorm ways to handle intensifying competition in an industry where software and platforms are eclipsing hardware.
Company vice chairman and co-chief executive officer Kwon Oh-hyun said products including smartphones, televisions and memory chips are likely to face escalated competition this year. Innovative business models are weakening traditional hardware values and workers must adapt to maintain leadership in an industry changing at its fastest pace ever, he said.
“The territories of industries are collapsing,” Kwon said. “We have to compete in a new way that we’ve never experienced in the past.”
Executives have preached the need to focus on software for years. Yet Korea’s largest listed company and the world’s largest smartphone maker has lagged Apple Inc in developing mobile-friendly software and a unique platform that can lock in users.
“The competition landscape is changing to software and platforms, so we need to build a new system and competence,” Kwon said in a speech distributed to the media.
In a signal of its newfound priorities, Samsung replaced the head of its phone operations last month with an executive, Koh Dong-jin, who helped create its mobile payment and security platforms.
Koh is expected to turn around a division that still leads the world in smartphone sales, yet has lost favor with investors.
Samsung lost more than US$8 billion in market value last year as sales of high-end S6 and Note 5 devices sputtered against new models from Apple and Chinese makers. Its shares posted a third straight annual decline last year, dropping 5.1 percent.
The company is expected to release its preliminary fourth-quarter earnings on Friday. Net income in 2014 is projected to be the lowest profit in four years, analyst estimates show.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San