Thu, Oct 03, 2024 page12

• Samsung to cut thousands of jobs

  FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix

  • Bloomberg
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  Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said.

  The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private.

  Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said.

  

  A woman walks past a Samsung Electronics Co store in Seoul on June 28.

  Photo: Bloomberg

  The South Korean company has about 147,000 in staff overseas, more than half of its total employees of more than 267,800, its latest sustainability report said.

  It is not planning layoffs in its home market.

  Samsung staff across different teams in Singapore were called into private meetings on Tuesday with human resource managers and their reporting managers, and were informed of the retrenchment and severance package details, another source familiar with the matter said.

  “Some overseas subsidiaries are conducting routine workforce adjustments to improve operational efficiency,” a Samsung spokesperson said.

  “The company has not set a target number for any particular positions,” the spokesperson added.

  Samsung shares have slid more than 20 percent this year as the world’s largest maker of memory chips and smartphones struggles in key markets. It has fallen behind rival SK Hynix Inc in the memory chips used for artificial intelligence (AI), and has made little progress against Taiwan Semiconductor Manufacturing Co (台積電) in the production of custom-made chips for outside customers.

  The task of leading Samsung through its latest challenges now falls to executive chairman Jay Y. Lee, grandson of the company’s founder. The 56-year-old was acquitted of stock manipulation charges in February after years of legal troubles.

  Samsung is in the unusual position of playing catch-up to SK Hynix, which took the lead in producing the high-bandwidth memory chips that are paired with Nvidia Corp’s AI accelerators to train AI models.

  Samsung abruptly replaced the head of its chip business this year and the newly appointed chief, Jun Young-hyun, said the company had to change its workplace culture or get caught in a “vicious cycle.”

  The company has reduced the size of its workforce in the past as it has navigated the notoriously cyclical memory-chip market. Samsung recently trimmed about 10 percent of jobs in India and some parts of Latin America, according to one of the sources.

  In the latest push, Samsung is likely to cut less than 10 percent of its total overseas staff of 147,000, the source said.

  The company aims to preserve manufacturing jobs, while it cuts management and support functions. The figures would be affected by local labor regulations and financial priorities.

  Samsung has also been feuding with employees in South Korea. The largest of the tech giant’s several unions called the company’s first strike ever in May.
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