Samsung CEO warns 2023 to be a ‘very difficult, challenging’ year

Samsung Electronics’ vice president and chief executive officer, Han Jong-hee, recently said that the company is bracing for a tough year ahead. The shares were shared by Han, who oversees Samsung’s smartphone and home appliance business, at a press conference on the sidelines of CES 2023.

According to this executive, many factors are affecting the company’s business this year. Even the industry as a whole is suffering from “a prolonged economic downturn, geopolitical tensions, supply chain risks and climate change.”

These overlapping crises have caused severe instability in the markets, leading to a halt in economic growth. That has caused consumers to become more conscious of their spending, leading to a drop in demand for items.

Samsung CEO believes that 2023 will likely be the year that determines the success or failure of many companies in the coming years. He said how a company weathers these crises will determine its immediate future.

And to that end, the Korean tech giant plans to continue focusing on “fundamental values” while innovating and expanding investments in future technologies like the metaverse and robot.

Samsung recently invested about $46 million in Korean robot maker Rainbow Robotics. The company also seems to see a bright future in the metaverse as it plans to develop technologies and solutions around it.

“Like all technology, it always attracts attention when it’s just getting started. But technology will go where it is needed most and I think the metaverse is also in that flow, ”said Mr. Han. He added that many other major tech corporations are also actively working on metaverse solutions.

Han’s comments on Samsung’s 2023 outlook came on the same day that the South Korean giant released estimates that its operating profit for the last three months of 2022 will drop by as much as 70%. The company expects its profit to fall to about $3.4 billion, from $11 billion it earned a year earlier. Weak purchasing power and low semiconductor chip prices are believed to have led to this large drop in profits.

The Korean conglomerate is also struggling in the smartphone market. The company is said to have missed its sales target last year. One of the biggest reasons for that is Samsung’s inability to penetrate the Chinese market. Samsung’s market share in the world’s most populous country is only 2%. However, Han said the company has found the problem and is preparing to launch new products suitable for this market in the coming years. Samsung has even set up a business innovation team dedicated to the Chinese market.

Despite a lot of bad news, shares of Samsung are still rising on expectations of merger talks between Japanese chipmaker Kioxia and US Western Digital. If successful, this will be an opportunity to end the competition in the field of NAND memory chips. market where Samsung is already the leader.

Refer to AndroidHeadlines, Nikkei Asia