Why Samsung has laid off over 800 employees in US
What's the story
Samsung Electronics has announced job cuts at its US display, phone, and other consumer electronics operations. The layoffs mainly affected workers in New Jersey and Texas. The South Korean tech giant confirmed that 739 roles in Englewood Cliffs, NJ have been impacted by Samsung Electronics America (SEA)'s decision to move its headquarters to Texas.
Job transition
Layoffs at Texas office too
Samsung has said that most of the employees affected by the job cuts have been given relocation offers. However, some were let go without any explanation.
At SEA's Plano, Texas office, around 100 workers, including those in its mobile division, have been laid off.
The exact number of layoffs at SEA remains unclear but documents show that an "enterprise-wide reduction-in-force" was communicated to some employees on June 30.
Employee worries
Fears of more layoffs, merger
The decision to move SEA's headquarters has raised eyebrows as the employees in New Jersey had only recently moved to new offices with much fanfare.
The unit employs around 1,200 workers in New Jersey.
Now, there are fears that these job cuts could be followed by more layoffs and a merger of Samsung's appliance, home entertainment, and mobile businesses as it prioritizes chips.
Business performance
Chip division thriving, consumer electronics struggling
The job cuts come as Samsung's chip division is on a high, with record profits driven by strong AI-driven chip demand.
However, its consumer electronics units are struggling due to rising chip costs.
The company has also announced plans to invest hundreds of billions of dollars in new chip plants.
Samsung's mobile division is expected to post its first-ever loss due to stiff competition from Apple and Chinese rivals like TCL and Hisense.