Samsung Electronics Co. is implementing a global job reduction plan, targeting thousands of employees across Southeast Asia, Australia, and New Zealand, Bloomberg reports, citing sources familiar with the situation.
The layoffs are part of a broader strategy to improve operational efficiency as the tech giant navigates a challenging market landscape.
While Samsung has declined to disclose a specific target number for job cuts, sources indicate that the layoffs could affect around 10% of the workforce in the targeted regions, though individual subsidiary figures may vary. Job reductions are also planned for other overseas subsidiaries, with some markets potentially facing a 10% cut.
The news comes amidst a period of significant financial strain for Samsung. The company’s shares have plummeted over 20% this year as the world’s largest memory chip and smartphone manufacturer struggles to maintain its market dominance. It has fallen behind rival SK Hynix Inc. in the production of AI-focused memory chips and has struggled to gain ground against Taiwan Semiconductor Manufacturing Co. in the custom-made chip market.
Samsung’s current challenges have placed a heavy burden on Executive Chairman Jay Y. Lee, who was recently acquitted of stock manipulation charges. The company is now actively seeking to revamp its business strategies and regain its competitive edge.
The job cuts are not limited to overseas markets. Samsung has already reduced its workforce in India and parts of Latin America, with a recent trim of around 10% in those regions.
The company is prioritizing the preservation of manufacturing jobs while focusing cuts on management and support functions. However, the final numbers are expected to be influenced by local labor regulations and financial priorities.
Despite these efforts to streamline operations, Samsung faces ongoing labor tensions in South Korea. The largest union representing Samsung employees staged the company’s first-ever strike in May, highlighting the strain of the company’s restructuring efforts.
The job cuts signal a period of significant transition for Samsung as it seeks to adapt to a rapidly evolving technological landscape. The company’s success in navigating these challenges will heavily depend on its ability to implement its restructuring plans effectively while maintaining a competitive edge in a fiercely competitive global market.
