Samsung Electronics Makes a One-Point Shake-Up at the Top of Its TV Business, Turning to a Marketing Veteran to Weather the Crisis

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[The Financial News] Samsung Electronics Co., Ltd. has abruptly replaced the head of its Television business and begun a major overhaul of its struggling Device eXperience (DX) Division. The move is seen as an effort to find a breakthrough for the Television business amid a global market downturn and aggressive low-price competition from Chinese manufacturers. It also reflects the company's decision to reshape leadership in a core business after the imbalance in earnings became entrenched, with semiconductors accounting for 94% of quarterly operating profit, or 53.7 trillion won, while the DX Division, which includes Television and home appliances, generated only 3 trillion won.
Samsung Electronics Co., Ltd. said on the 4th that it had appointed Won-Jin Lee, who had been serving as president and head of global marketing, as head of the Visual Display Business Division, which oversees the Television business, and named Yong Seok-woo, the former head of the Visual Display Business Division, as head of the DX Division Advisory Office. The company said the move was unusual because it was a one-point personnel change made outside the regular personnel season. Industry observers also said the company appears to have placed Lee, whose marketing capabilities have been proven, at the forefront as a "rescue pitcher" ahead of major global events such as this year's World Cup.
Samsung Electronics Co., Ltd. said, "President Won-Jin Lee is a 'content, service and marketing expert' who helped build the core foundation for Samsung Electronics Co., Ltd.'s Television and mobile service businesses and contributed to strengthening global business competitiveness, thereby proving his capabilities and leadership as a manager." It added, "Based on his rich experience in business success and deep understanding of the market, he is expected to lead a business turnaround from a fresh perspective, discover new growth engines for the future and further strengthen the competitiveness of the Television business."
Yong Seok-woo, who was appointed head of the DX Division Advisory Office, is expected to serve as an adviser on future core technologies across the set business, including artificial intelligence (AI) and robots, drawing on his R&D expertise and extensive business experience.
The personnel change is being interpreted as a response to widening gaps between business units despite record-breaking results. In the first quarter of this year, Samsung Electronics Co., Ltd. posted quarterly highs in both sales and operating profit, at 133.87 trillion won and 57.23 trillion won, respectively. However, 94% of the profit came from semiconductors, leading to the view that the results were effectively driven by semiconductors alone.
During the same period, the DX Division recorded sales of 52.7 trillion won and operating profit of 3 trillion won. Operating profit fell by about 1.7 trillion won from 4.7 trillion won a year earlier. The Mobile Experience Division, including the Network Business Division, earned 2.8 trillion won in the first quarter and supported earnings, but the Digital Appliances and Visual Display divisions remained at around 200 billion won. All DX divisions have already effectively entered emergency management mode.
The Television business, in particular, is in a global slump. Worldwide Television shipments this year are expected to reach 210 million units, up only 1% from 208 million units last year. Competition is also intensifying as Chinese manufacturers step up low-price pressure and TCL, a major player in the market, launches a Television joint venture with Sony. Against this backdrop, the company is moving to replace leadership around the Television business and accelerate efforts to improve the DX Division's fundamentals.
soup@fnnews.com Lim Su-bin Reporter