Amid Galaxy S9 Sluggish Sales, Samsung Investigates US Operations

Samsung Electronics is carrying out an investigation on its operations in the United States amid the reported “sluggish sales” of its Galaxy S9 flagship phone in the country.

A Samsung spokesperson confirmed to The Investor Thursday that the South Korean tech giant has launched a large-scale inspection program that will look into its U.S. operations. However, the spokesperson stressed that the investigation isn’t because of the reported disappointing sales of the Galaxy S9 in the U.S. market.

“The inspection is not a punitive measure targeting a specific underperforming unit,” the Samsung spokesperson said. “It is a usual process aimed at reviewing the status of business departments and global offices.” The spokesperson then noted that such inspection is targeted at resolving operation problems. “We usually address problems based on the results, if there are any.”

Even though the spokesperson has already clarified that the inspection isn’t related to the Galaxy S9’s sluggish sales, industry watchers are still concerned about the tech giant’s performance in the U.S. smartphone market.

The concerns sprang from reports claiming the latest flagship device isn’t doing that well compared to last year’s Galaxy S8. The S9 — considered a minor upgrade device — is said to be selling only 90 percent of what its predecessor achieved in the same period last year.

“Samsung is likely to see some drop in profits in the second quarter due to the slowing smartphones sales together with a weaker demand for OLED displays,” a KTB Investment & Securities analyst predicted.

While the inspection program may not have directly resulted from the Galaxy S9’s performance, it could help improve the bigger picture for Samsung’s performance in the U.S. For one thing, the inspection team are going over a range of issues possibly plaguing Samsung Electronics America’s New Jersey headquarters, such as accounting, human resources, cost structure and marketing schemes.

Another market where Samsung’s smartphone business isn’t doing quite well is China. Earlier this week, the tech giant launched the new red color option of the Galaxy S9 in the large Asian market in hopes of revitalizing its presence there.