Samsung Display split-off becomes official
updated 07:50 am EDT, Mon April 2, 2012
Samsung Display now stand-alone company
Samsung has launched a new corporation spun off from Samsung Electronics. The new company, Samsung Display, was previously an R&D arm of Samsung Electronics and has now also officially become the world’s largest display manufacturer on its inauguration. The new company, which remains fully owned by its parent company, employs 20,000 people worldwide working in five factories around in the globe.
Although the company achieved display sales in the order of $20 billion in 2011, it managed to record an operating loss of around $665 million. It was this result that gave rise to Samsung’s move to spin off the company. The CEO of Samsung Display, Donggun Park, aims to move the company into a new focus on OLED display production, but with maintain two divisions, with the other continuing to manufacture LCDs.
The worldwide LCD panel industry has been facing cutthroat competition. Although Samsung was on the end of a large loss, its Japanese competitors including Sony and Panasonic saw similar or larger losses. Competition between LCD panel makers in Korea, Taiwan and Japan has left profits margins exceptionally slim. Where a company like Apple can enjoy up to a 40 percent margin on some of its products, Sony’s TV division is relying on a profit margin as slim as just 5 percent in order to remain competitive.
