Samsung Electronics' DX Division Bets on 'Chicken Game' to Overcome Losses

Samsung Electronics' Device Experience (DX) division, which handles smartphones, televisions, and home appliances, is adopting a bold strategy to confront its first quarterly deficit. The division intends to expand its market share through a 'chicken game' approach, aiming to strengthen its market dominance even as it anticipates continued losses in the short term.

The DX division's financial performance has significantly declined. In the first half of 2026, its operating profit plummeted to 2.1 trillion won, a sharp decrease from 8 trillion won in the same period last year. The situation worsened in the second quarter, with the division reporting an operating loss of 800 billion won, marking its first-ever quarterly deficit since its establishment in 2021. The company projects that if current memory price increases persist, the Mobile Experience (MX) business unit, responsible for smartphones, may also struggle to escape losses.

Despite these challenges, Samsung Electronics outlined its strategy for the latter half of 2026, emphasizing market share expansion, improving internal structures, and preparing innovative products. The company plans to engage in a 'smartphone chicken game,' strategically increasing market share and sales even at a loss. The goal is to dominate the market once memory prices stabilize.

In line with its principle of 'rewards for performance,' Samsung Electronics announced that providing additional performance bonuses to DX division employees will be difficult in the near future. Due to the company's long-standing 'one roof, two companies' system, which separates business, personnel, finance, and accounting operations between the semiconductor (DS) and DX divisions since 2009, offering extra compensation to the DX division, which receives less than the semiconductor division, is deemed impossible.

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We will pursue a strategy of expanding market share and improving our constitution, and prepare innovative products.