Samsung's mobile unit nears first loss amid US restructuring and Apple rivalry

SEOUL — Samsung Electronics' mobile division is expected to post its first-ever loss as it grapples with intense competition from Apple — a stark sign of the strain on the South Korean giant's consumer businesses, even as its chip unit thrives on the AI boom.

The projected loss came to light as Samsung confirmed it is cutting jobs across its US consumer electronics operations. The company told Reuters on Sunday that 739 roles in Englewood Cliffs, New Jersey, are affected by a plan to move the headquarters of Samsung Electronics America (SEA) — its consumer electronics arm, which does not include chips — to Texas.

Most of those affected received relocation offers, while others were let go, Samsung said without elaborating. At SEA's office in Plano, Texas, about 100 workers, including some in the mobile division, were laid off, according to a person who said they were among those affected. The New Jersey figure was disclosed in a US WARN notice.

The mobile business, long one of Samsung's flagship operations, is battling fierce competition from Apple's iPhone. Chinese brands such as TCL and Hisense are also pressing the company in televisions and home appliances, while higher chip costs driven by the AI boom have weighed on earnings across its consumer electronics range.

The pressure contrasts sharply with Samsung's semiconductor division, which has benefited from surging demand for AI-related chips. As the company channels more resources toward that business, some employees fear further layoffs and a possible consolidation of its appliance, home entertainment and mobile units, a current SEA employee said.

Samsung's cuts echo a wider industry trend. Microsoft, Amazon and Meta have all shed jobs while pouring investment into AI infrastructure. In relocating to Texas, Samsung joins firms such as Tesla and Oracle that have moved headquarters or major operations to the state, drawn by lower taxes and lighter regulation. Texas already hosts Samsung's chip factories and a mobile hub in Plano.

Samsung has said the relocation is intended to improve collaboration by bringing teams together within Texas' growing technology and AI ecosystem.