Samsung executives admit smartphone earnings won’t improve in third quarter, restructure discussed at crisis meetings

Samsung executives admit smartphone earnings won’t improve in third quarter, restructure discussed at crisis meetings

Samsung Electronics executives have admitted earnings are unlikely to improve during the third quarter, with reports emerging of a crisis meeting held at the South Korean conglomerate.

Samsung’s operating income fell around 24% in the June quarter to 7.2 trillion won ($A7.1 billion), its worst result in two years.

The result came as IDC market share figures showed its share of the global smartphone market slipped to 25.2% off 74.3 million units worldwide, down from 77.3 million a year earlier.

According to the Chosun Ilbo, key investors were told during a conference call late last week the company plans to release new devices in the third quarter, including the Galaxy Note 4, but this is unlikely to improve earnings during the third quarter.

Meanwhile, Korea JoongAng Daily reports Samsung held crisis meetings ahead of the results on July 26 to 27. Concerns include the possibility the Tizen operating system has damaged relations with Google, while its “fast follower” strategy is vulnerable to emerging Chinese electronics brands including Xiaomi, Lenovo, ZTE and Huawei.

The conglomerate is now looking at consolidating its smartphone, television and home electronics divisions as part of a restructure, with one senior executive reported to have said the company now views smartphones as one of many Internet of Things devices.

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