Samsung Electronics SSNLF, the world’s top producer of smartphones, TVs, and memory chips, is reportedly planning to reduce its overseas workforce in some divisions by up to 30%. The South Korea-based tech giant has instructed its global subsidiaries to decrease sales and marketing staff by around 15% and administrative staff by up to 30%.
What Happened: The job reductions, expected to be executed by the end of the year, will impact jobs across the Americas, Europe, Asia, and Africa, Reuters reported on Wednesday. However, the exact number of employees to be laid off and the countries and business units to be most affected remain uncertain. Samsung clarified that these workforce adjustments are routine and aimed at improving efficiency, with no specific targets and no impact on production staff.
As of 2023’s end, Samsung had a total of 267,800 employees, with over half, or 147,000 employees, based overseas. The company’s India operation, which employs around 25,000 people, could see up to 1,000 job cuts. In China, about 30% of the sales operation workforce is expected to be affected.
Samsung has yet to respond to Benzinga’s queries.
Why It Matters: The job cuts come at a time when Samsung is grappling with mounting pressure on its key units. Its chip business has been slower than its rivals in bouncing back from an industry slump that pushed its profit to a 15-year low last year. In the premium smartphone market, Samsung is facing fierce competition from Apple Inc. AAPLand China’s Huawei. The job cuts are viewed as a strategy to brace for a slowdown in global demand for tech products and to strengthen its bottom line by cutting costs.
These layoffs follow recent reports of declining sales and intensifying market competition in India, where the company’s value and volume market share have hit their lowest in a decade, prompting the company to reportedly gear up for layoffs. Additionally, earlier this year, employees at Samsung Electronics initiated a three-day strike demanding better pay, warning of additional actions if their demands were not met.
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This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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