Abu Dhabi, UAEThursday 20 February 2020

Samsung appoints new mobile business chief as it eyes higher sales

Roh Tae-moon, a former development manager in the Galaxy division, was instrumental in helping the company to improve sales and cut costs

Samsung reported a 56 per cent plunge in the third-quarter operating profit last year. Reuters
Samsung reported a 56 per cent plunge in the third-quarter operating profit last year. Reuters

The world's biggest smartphone and memory chip maker, Samsung, appointed Roh Tae-moon - one of its youngest presidents – to head its smartphone business as it looks to snare market share from its rivals Huawei and Apple.

DJ Koh, the former mobile chief, will lead the company’s IT and mobile communications business that looks after both devices and network equipment, Samsung said in a statement on Monday.

“Samsung is facing increased competition in the smartphone segment, so it is turning to Roh to present fresh strategies and revitalise the organisation,” said Android Central, a technology news provider that focuses on Google-owned Android devices such as Samsung smartphones, in a report on Monday.

Mr Roh, a 51 year-old development manager in the company's Galaxy division, was instrumental in Samsung’s recent efforts to outsource more handset production to cheaper locations to cut overall costs in a highly competitive market.

“Samsung’s reshuffle seems aimed at coping with a potential major market change with the new technology,” Tom Kang, an analyst at Hong Kong-based researcher Counterpoint, told Reuters.

“The young executive is known to be decisive and so is likely to respond swiftly to change to defend Samsung’s lead from Huawei.”

Although the South Korean smartphone giant saw its mobile business picking up in the third quarter of last year, the company foresees tough times ahead.

In the three months to September 30 last year, Samsung’s IT and mobile business posted 2.92 trillion Korean won (Dh9.06 billion) in profit, up 32 per cent from the same period in 2018 and 87 per cent from the second quarter.

However, Samsung predicted a decrease in mobile business earnings in the fourth quarter as it posted a statement in October saying that “marketing costs will rise and shipments will decline slightly, with flagship model sales weakening from their post-launch peaks”.

Samsung is set to roll out its premium line of new S series smartphones and a second foldable phone next month in San Francisco as it seeks to secure new customers.

Samsung is currently battling Apple and Huawei to retain its market dominance within the smartphone segment.

After facing a nearly 8 per cent dip in smartphones sales year-on-year in the first quarter of 2019, the company rebounded in the second and third quarters with a 6.9 per cent yearly rise in sales in the six months to September 30, according to the International Data Corporation.

However, Samsung saw a 56 per cent plunge in third-quarter operating profit to $6.6bn (Dh24.2bn) caused by lower sales of its expensive devices and a decline in its chip business.

That was the fourth consecutive quarter where Samsung’s operating profit fell year-on-year. The company’s quarterly revenue also fell 5.37 per cent year-on-year to $52.8bn.

Updated: January 20, 2020 01:36 PM

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