SEOUL – Samsung Electronics issued a lengthy apology after posting disappointing results, an unusual admission by the world’s largest memory-chip maker that it is grappling with a potential crisis.
The company will review its organisational culture and processes, Mr Jun Young-hyun, the newly appointed head of its chip business, said.
“Rather than relying on short-term solutions, we will focus on reinforcing our long-term competitiveness,” he added. “These are testing times.”
The world’s biggest maker of both memory chips and smartphones reported preliminary operating profit of around 9.1 trillion won (S$8.8 billion) in the September quarter versus the 11.5 trillion won projected. A one-time cost related to provisions for performance-related bonuses weighed on earnings, it said.
Revenue came in at 79 trillion won, compared with expectations for 81.57 trillion won. Samsung plans to provide a full financial statement with net income and divisional breakdowns later this month.
“We have caused concerns about our technical competitiveness, with some talking about the crisis facing Samsung,” Mr Jun said. “As leaders of the business, we take full responsibility for this.”
The company laid off an undisclosed number of workers in Singapore earlier in October as it cut thousands of jobs globally.
It has about 147,000 staff overseas, more than half of its total employees of over 267,800, according to its latest sustainability report.
Samsung’s share price, which has fallen more than 20 per cent this year, slipped as much as 1.8 per cent after the earnings’ guidance.
In a further challenge, Samsung said sales of its high-end HBM3E chips to an unidentified major customer have been delayed.
Earnings declined in the company’s memory chip business as Chinese chip rivals increased supplies of “legacy” products” and some mobile customers adjusted inventories, offsetting solid demand for high bandwidth memory (HBM) and other chips used in
