Samsung's Profits Tanked 60%, But The CEO Gets To Keep His Job

JK Shin, the CEO of Samsung’s mobile division, will keep his job even though the company’s profits have dropped drastically over the past year, Bloomberg reports, citing a Samsung statement.

Last week, The Wall Street Journal reported Samsung was considering replacing Shin because Samsung’s profits dropped 60% last quarter due to dwindling smartphone sales.

Samsung has three co-CEOs. Shin is in charge of the mobile division. B.K. Yoon, the CEO in charge of TVs and appliances, was a possible candidate to take over for Shin, according to the WSJ report.

But it’s now official Samsung will stay the course, even though Shin’s mobile division has shown no signs it can stay competitive with smaller companies that make Android phones.

For example, Chinese startup Xiaomi is now the third-largest smartphone vendor in terms of sales. Its phones can do everything Samsung’s flagship phones can do but cost half as much. Samsung gets most of its profits from the high-end of the smartphone market, but hasn’t found a way to differentiate its phones from a software standpoint.

That’s Shin’s biggest challenge moving into 2015. He needs to find a way to make Samsung’s phones stand out with new, useful software features that are different from what you can get from other Android phones. He can also try to explore new product categories like smartwatches, but those won’t be nearly as profitable as smartphones.

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