Home AI to drive earnings recovery, Samsung Electronics CEO says

Samsung Electronics CEO and Vice Chairman Han Jong-hee speaks throughout a gathering with reporters at Caesars Palace in Las Vegas, Tuesday (native time), on the sidelines of CES 2025. Courtesy of Samsung Electronics

LAS VEGAS — Samsung Electronics CEO and Vice Chairman Han Jong-hee mentioned, Tuesday (native time), that the corporate’s synthetic intelligence (AI) imaginative and prescient for sensible properties, unveiled at CES 2025, will assist drive momentum for its earnings restoration.

The remarks adopted Samsung’s estimate that its working revenue for the fourth quarter of 2024 reached 6.5 trillion gained ($4.47 billion), beneath an analysts‘ consensus of seven.97 trillion gained. Relating to the corporate’s AI initiatives, Han expressed confidence that Samsung will overcome market issues about its competitiveness this yr.

“The house AI we introduced at CES 2025 is a imaginative and prescient that redefines ever-evolving AI know-how from the purchasers’ perspective, primarily based on over a decade of our collected expertise within the sensible home based business,” Han mentioned throughout a press convention.

“Our purpose isn’t solely to extend the variety of AI-powered merchandise but additionally to comprehend a house AI system that seamlessly connects gadgets, anticipates buyer wants and responds intuitively and well.”

Throughout CES 2025, Samsung showcased examples of extra personalised AI experiences, supported by its AI-embedded dwelling home equipment and SmartThings Web of Issues know-how. In doing so, the corporate selected to place its newest merchandise in a secondary function on the exhibition, emphasizing that its strategic focus is now on AI.

Citing constructive suggestions from international distributors, Han expressed confidence that this imaginative and prescient will function the „momentum“ for the restoration of the corporate’s earnings.

In its earnings steerage launched earlier Tuesday, Samsung estimated its fourth-quarter working revenue at 6.5 trillion gained, up 130.5 p.c from a yr earlier. The corporate anticipated that income would attain 75 trillion gained, rising 10.65 p.c year-on-year.

Though the numbers mirror year-on-year enhancements, they’re seen as disappointing given analysts’ common estimates, which had forecast an working revenue of seven.97 trillion gained and gross sales of 77.4 trillion gained.

2025-01-08 15:10  |  Tech

As that is solely earnings steerage, Samsung didn’t present an in depth breakdown of earnings by enterprise division. Nevertheless, analysts imagine the corporate’s smartphone enterprise has slowed, whereas its semiconductor division continues to face challenges on account of unfavorable market situations.

“It’s true that the (fourth-quarter) earnings are decrease than market expectations,” Han mentioned. “However we imagine that it may be a chance for us to make a leap ahead. We have now Gadget Expertise and Gadget Options divisions, and the Gadget Options division has Vice Chairman Jun Younger-hyun, who’s now striving for a rebound, so you may anticipate enhancements this yr.”

Samsung’s Gadget Expertise division, led by Han, consists of smartphones, dwelling home equipment, visible shows and well being care companies. The Gadget Options division, headed by Jun, is answerable for reminiscence, chip design and foundry companies.

“Samsung will overcome each problem by committing ourselves really to the very fundamentals of our enterprise,” he mentioned. “And the basic we imagine is making an unequalled know-how innovation towards product high quality and buyer worth. To materialize this, we now have reorganized our groups to place better emphasis on product high quality and AI companies.”

Throughout its personnel shakeup in November, Samsung created a product high quality innovation committee headed by Han himself, guaranteeing that he would immediately oversee the standard of the corporate’s dwelling home equipment.

Additionally, the corporate established a crew serving because the management tower of its AI enterprise below Chief Know-how Officer Cheun Kyung-whoon, to verify it may promptly reply to new applied sciences in not solely gadgets but additionally providers.

Attendees go to Samsung Electronics‘ sales space at CES 2025 on the Las Vegas Conference Middle, Tuesday (native time). Yonhap

Favorable responses

Han mentioned the corporate determined to concentrate on the client experiences that AI-powered home equipment can ship, as it’s the simplest approach to leverage Samsung’s broad product portfolio.

“Our product ranges from smartphones, TVs, dwelling home equipment, digital auto components and a slew of different gadgets that individuals use of their each day lives, and after we take into consideration leverage this energy, it finally comes right down to delivering a seamless linked expertise,” he mentioned.

“And that have is about having AI care for the issues which are inconvenient, undesirable or troublesome for the patron. The last word purpose when AI is built-in into merchandise is automation.”

Han mentioned that the corporate’s technique of specializing in buyer experiences that AI-powered home equipment can present is receiving constructive responses from distributors.

“Once we mentioned final yr that we would supply linked experiences by way of AI, the suggestions was extra like, ‘Okay, that sounds tremendous, however we don’t actually perceive what it means,’” Han mentioned.

“This time, nonetheless, the final response has been that they now absolutely grasp our methods and discover them engaging. Since we shared a long-term imaginative and prescient with them, they now have a clearer understanding of our roadmap. In consequence, we anticipate modifications not solely in store shows but additionally in how they method shoppers.”