Samsung apologizes for its earnings of only $6.8 billion in the last quarter.
Only the exaggeration surrounding artificial intelligence could qualify this as a "crisis."
Samsung, the world's leading memory chip manufacturer, has issued an unusual apology after announcing that it expects an operating profit of only $6.78 billion for the last quarter, a figure that falls short by about $900 million of analysts' expectations. In a statement, Samsung Vice President Jun Young-hyun acknowledged that "we have raised concerns about our fundamental technological competitiveness and the future of the company due to our performance below market expectations."
The executive emphasized that "many people are talking about the Samsung crisis" and took responsibility for the business leadership in this situation. In response to this so-called "crisis," the company implemented a six-day work week for executives earlier this year, motivated by the poor financial results it has faced in 2023, caused by increased competition and a general decline in chip demand.
Samsung had anticipated that the wave of enthusiasm surrounding artificial intelligence could turn its situation around, evidenced by a 15-fold increase in its profits last quarter, driven by the sales of its high-bandwidth memory chips to Nvidia. However, the company has reported that sales of its high-end HBM3E chips to a major unidentified customer have been delayed, allowing competitors such as SK Hynix to fill that gap in the market. Additionally, Samsung faces increasing competition from Chinese rivals in the sale of conventional chips used in devices like smartphones.
In its message to customers, investors, and employees, Samsung expressed its historic commitment to innovation and its ability to turn crises into opportunities. The company emphasized the need to restore its fundamental technological competitiveness, assuring that "technology and quality are our lifeblood" and that no compromises will be made in these areas. It also pledged to prepare for the future with renewed passion and to review its organizational culture and ways of working, prioritizing communication and trust within the company.
Samsung concluded its statement by assuring that, with a firm focus on the challenges, it is possible to transform the current crisis into a new opportunity, while seeking the support and encouragement of all involved.
