Report: Samsung to cut 10 percent of head office staff

According to the Economic Daily, a Korean newspaper, Samsung is preparing to cut 10 percent of office staff at its headquarters. The electronics giant has been struggling with lower than expected revenue results, as its smartphone sales lose ground to lower cost rivals.

Samsung will apparently be cutting employees in its human resources, public relations and finance departments, as part of the company’s ongoing cost cutting measures. These could be extended through to next year as well. The company employed a total of 98,999 staff at its headquarters as of June 30, according to a regulatory filing.

Despite a generally positive reception for its latest line-up of Galaxy smartphones, Samsung doesn’t appear to have translated this into a rebound in profits. The company saw smartphone shipments drop again in Q2. Samsung also apparently suffered with display production issues earlier in the year, which, combined with increasing competition from more cost effective manufacturers, has been hurting the company’s income for numerous quarters.

“Samsung’s preparing to tighten its belt as it isn’t likely see rapid profit growth in the years to come.” – Chung Chang Won, an analyst at Nomura Holdings Inc. in Seoul.

According to data from Bloomberg, Samsung generated 206.2 trillion won ($171 billion) in sales last year and is estimated to return around 200.2 trillion won in sales this year, suggesting a mostly flat 12 months. Cost cutting measures could help Samsung boosts its profit, but won’t help to address the company’s underlying sales slump.

Samsung refused to comment on the matter.