Samsung Electronics will freeze employee salaries this year for the first time since 2009, a spokeswoman for the South Korean company said on Thursday, without elaborating.
The move comes after the company’s profit declined in 2014 for the first time in three years as its lead in smartphones was challenged by Apple.
According to a report, Samsung had posted its first drop in annual net profit in three years, just a few days after arch-rival Apple reported the biggest corporate profit in history. The tech giant said it recorded a net profit of 23.4 trillion won ($21.45 billion) in 2014, down 23.2% from a year ago and the first decline since 2011.
The fall was cushioned in the fourth quarter by a boom in high-margin chip sales that helped offset the downturn in the key mobile sector, with operating profit in the semi-conductor division rising 35.7% to 2.7 trillion won in the October-December period from a year earlier.
The annual profit figure marked a dramatic reversal for the company, which is also facing a once-in-a-generation leadership change, after several years of stellar growth, driven by the once all-conquering mobile division.
Apple’s performance was driven by the sale of 74.5 million iPhones, which included a doubling of sales volume in the crucial Greater China region.
Samsung to freeze employee salaries for the first time since 2009
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