LONDON – Amidst a troubled global economy Samsung has set a record investment budget for 2012 of 47.8 trillion won (about $41.7 billion) for its operations, according to reports.
The company is expected to focus particularly on logic chips and OLED displays. The high-spending strategy is expected to augment its already dominant position in memory ICs and liquid crystal displays, as the company seeks to put distance between itself and rivals, reports said.
The company also plans to employ an additional 26,000 staff, up from the 25,000 new hires it made in 2011. Samsung now employs about 350,000 staff, according to a Reuters report.
Group capital spending is expected amount to 31 trillion won (about $27 billion) up 11 percent on 2011. Some 80 percent of that (about 25 trillion won or $22 billion) is to be spent by Samsung Electronics Co. Ltd. to boost manufacturing capacity for logic chips, MEMS sensors and OLED displays as well as memory and LCD production. The logic chip manufacturing is likely to focus on Samsung's ambitions to make application processors and system chips for mobile phones and tablet computers.
Investment in logic chips, at 7.5 trillion won (about $6.5 billion), is set to exceed investment in memory chips, at 6.5 trillion won (about $5.7 billion) for the first time. Investment in OLEDs is expected to go up from 6 trillion won in 2011 to 7 trillion won (about $6 billion).
Samsung had 22 trillion won (about $19 billion) in cash as of the end of September and is set to report a record 5.3 trillion won (about $4.5 billion) fourth-quarter operating profit after great Q4 success selling its Galaxy line of mobile phones. Samsung said Monday it planned to issue around $1 billion in bonds in the U.S. to help fund its chip unit.
Samsung is expanding spending while its local rival LG is cutting back and Japanese rivals Sony, Toshiba, Sharp and Hitachi are struggling to keep pace. Those four companies are set to spend a combined 1.3 trillion yen (about $16.6 billion) in the current fiscal year, which ends on March 31.
Samsung Group revenues account for about 20 percent of South Korea's 1,200 trillion won annual GDP.
Samsung is expanding like swallowing all the rivals. Chairman Mr.Lee's nickname is South Korea's number two behind the Korean president who is number one. Well, his company Samsung Electronics is already a global number one in electronics industry though. Survival of the fittest.. bloody.. so bloody..
"Samsung Group revenues account for about 20 percent of South Korea's 1,200 trillion won annual GDP"
If this is correct it is a stunning fact. A company with 350,000 employees accounts for 20% of GDP of a country with 50 million?
Research and Development focus towards OLED for Large Scale Displays that what was eagerly waited from some giants and Samsung has become the first one to take that opportunity, the world will be having a very revolutionary era in the displays segment in the coming years.
Their early investment in LCD display market proved to be very wise, and I would think that they are also looking forward with OLED technology replacing LCD in the next few years. Having both product areas enables them to retain market share. While one is ramped up, the other can be ramped down.