Samsung is reportedly planning to layoff as much as 10% of its staff at its South Korea headquarters in a move that highlights the continuing struggle it has to compete with lower cost smartphone makers from China and Apple in the worldwide smartphone space that at one time it dominated.
The company already has started cutting back on staff at is back office in Suwon, South Korea, including those in human resources, finance and its press office, according to a South Korea newspaper report.
Samsung is also planning to cut back general expenses by up to 50%, having saved already more than 1.8 trillion won or $1.5 billion in sales and office expenses during the first six months of 2015, the paper added.
At the start of the year, Samsung also revealed it was cutting down on its huge marketing budget to prepare for its upcoming competitive pressures.
Samsung has come under great pressure from a global slowdown in shipments of smartphones as the previously rapidly growing markets such as China have reached a saturation point and the end result has been a drop in its market share along with thinning margins.
The company launched its new S6 and S6 Edge earlier in the year, but the release suffered from delays in components and Samsung was not able to ship the volumes it hoped to.
This past July it announced that to help it face the difficult environment it would cut its prices for the two smartphones.
Samsung has since then made a number of announcements for new products including its Gear 2 smartwatch. The new wearable device runs on the Tizen, Samsung’s own operating system.
On August 15, Samsung launched its two new Galaxy S6 Edge + and the Galaxy Note 5 that preempted the launch by Apple of its new iPhone that is scheduled to take place on Wednesday September 9.
Get Analysts' Upgrades and Downgrades Daily - Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.