Samsung Electronics announces plans to merge mobile and consumer electronics units
The company is also naming new co-chief executives as it pivots to two business units, chips and components and consumer devices.
This is one of the company's biggest shake-ups. Image source: Samsung.
Samsung Electronics said on Tuesday it will merge its mobile and consumer electronics divisions into a single business unit. This will leave the company running two business units, the chips and components and consumer devices.
In addition to the streamlining, the company is naming new co-chief executives and cutting the number of them from three to two.
The head of the visual display business, Han Jong-hee, was promoted to vice chairman and co-CEO, and will lead the newly merged mobile and consumer electronics units, while continuing to lead the TV business.
The current CEO of Samsung Electro-Mechanics, Kyung Kye-hyun, was named as the other co-CEO of Samsung Electronics and will head up the chip and components division.
Reports have placed the shake-up at the feet of slowing mobile growth whose profit contribution shrank to 21% last quarter from nearly 70% at its peak in the early 2010s. Conversely, the chip and components division has surged in contribution thanks to the recent global shortage. The business generated nearly three-quarters of Samsung's 15.8 trillion won (S$18.3 billion) operating profit last quarter.
It is not immediately clear what changes or divisions of labour were expected under the new CEOs, but reports have analysts saying the reshuffle could help Samsung tackle challenges such as offering seamlessly connected services between its smartphones and home appliances.
Of more immediate concern is still the global chip shortage, rising materials costs, Covid-19 logistical concerns, and competition from the likes of Apple and Chinese firms such as Huawei, Oppo, and Xiaomi.
Source: Reuters.
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