Samsung kept its impossible promise and rocketed to the top of the global smartphone market on the back of its Galaxy handset lineup and its multi-billion dollar marketing campaigns. Unfortunately, beating the same drum repeatedly has seen Samsung reverse course just as quickly as it rose to become the No. 1 phone vendor by volume, and Samsung has seen its smartphone sales and profits decline for the past seven consecutive quarters.
The company’s flagship Galaxy S6 was by far the best smartphone Samsung had ever created, but even the best isn’t good enough when you’re up against Apple’s iPhone 6. Now, Samsung has reportedly begun implementing a series of cost-cutting measures in an effort to offset the weakness in its core smartphone business.
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According to a report on Tuesday, just one day before Apple is set to unveil its next-generation iPhone and iPad lineup, Samsung is set to lay off 10% of its workforce, or nearly 10,000 employees, at its headquarters in South Korea. The news comes from The Korea Economic Daily, which adds that Samsung hopes to cut back on general expenses by as much as 50% in 2016. The report notes that impacted divisions include the company’s finance, personnel, and public relations departments.
Samsung shares climbed more than 1.7% on the news, but are still down nearly 15% so far in 2015.
The South Korean smartphone giant has struggled to combat chief rival Apple in the smartphone space. After building a monster phone business on the back of advertising campaigns that bashed Apple’s iPhone and its sheep-like customer base, a wave of copycat accusations and court battles succeeded in swaying the general public’s impression of Samsung. Combined with an annual Apple-esque update schedule that saw Samsung release relatively minor iterative updates each year, Samsung’s sales didn’t stand a chance.
Korea Economic Daily noted that Samsung already managed to save more than $1.5 billion in the first half of 2015 by slashing its sales budget and cutting back on administrative expenses.
