Samsung Electronics is reportedly considering major deals to boost growth as the company faces shareholder disappointment over the recent drop in share price and falling operating profits in recent quarters.
On Wednesday, the South Korean company was questioned by shareholders for its inability keep up in the artificial intelligence (AI) race, which led it to be one of the worst-performing tech stocks last year, according to a report by Reuters.
The company admitted distancing itself from competitors in the race for advanced memory chips and contract chip production, which are increasingly in demand in AI developments, leading to a substantial decrease in Samsung’s profits.
“First and foremost, I sincerely apologise for the recent stock performance not meeting your expectations,” Samsung co-chief executive officer Han Jong-hee told shareholders at the meeting, according to Reuters. “Over the past year, our company failed to adequately respond to the rapidly evolving AI semiconductor market,” Jong-Hee predicted difficulties in 2025 due to uncertainties over economic policies in major economies, which Samsung intends to address by pursuing “significant” mergers and acquisitions to promote growth.
“There are some difficulties in doing semiconductor M&As due to regulatory issues and various national interests, but we’re determined to produce some tangible results this year,” he said.
Jun Young-hyun, Samsung co-chief executive officer and head of its semiconductor business assured shareholders that 2025 would be “the year when we recover our fundamental competitiveness”.
“Our technological edge has been compromised across all our businesses,” said a transcript of a message from Chairman Jay Y seen by the news agency. “It’s hard to see that efforts are being made to drive big innovation or tackle new challenges. There are only efforts to maintain a status quo rather than shaking things up.”
During the meeting, shareholders called for the introduction of new measures to boost stock prices, after the company introduced last year a stock-based performance system reward to executives last year. Samsung said at the meeting it is now considering extending the system to employees next year.
One of the shareholders told Reuters ahead of the meeting that the stock performance has been “disappointing”.
“Last year, the stock price was so bad that I even considered investing in US stocks instead,” they added.
In November, the tech giant announced plans to buy back a total of KRW 10 trillion ($7.17 billion) of the company’s shares to increase shareholder value.
The move came after the chipmaker giant revealed that its most recent quarterly results were below market expectations.
“The performance that fell short of market expectations has raised concerns about the fundamental technological competitiveness and the future of the company,” Young-hyun said in a statement at the time.
