Samsung India Cuts 80-100 Jobs Amid Rising Chip Costs, Falling Rupee

Samsung India has started cutting jobs across the company as chip prices soar, the rupee weakens, and sales slow down in the market. The company is letting go of 80 to 100 managers and senior employees working in the TV and home appliances divisions. About a quarter of the sales and marketing staff could lose their jobs. The company is doing this to protect its profits ahead of the festive season.

These job cuts are affecting everyone from top executives to smaller branch managers. Termination letters are being handed out to a few employees each day. Affected staff are being told to leave immediately without serving a notice period. As compensation, the company is offering three months' salary plus one extra month's pay for every year worked. Alongside this, Samsung is merging some branch offices to cut costs, combining offices in Ranchi and Patna, Delhi and Gurugram, and Punjab and Chandigarh.

The main reason behind this is rising costs. As AI companies buy more chips for their data centers, chip prices have doubled over the past year. Since Samsung doesn't have its own chip factory, it has to bear this extra cost itself. On top of that, the rupee's 10% fall has made imported parts even more expensive. This forced the company to raise prices on some appliances and phones by 5 to 10 percent, even though retailers opposed the hike. Samsung earned ₹1.1 lakh crore in revenue last financial year, but phone sales fell by 11 to 12 percent, and AC sales also didn't grow as much as expected.

However, the company has spared its mobile phone division from these job cuts, since phones bring in about three-quarters of its total revenue. Samsung is hoping that Galaxy phone sales will pick up during Dussehra and Diwali. But if festive sales don't meet targets, insiders say another round of layoffs could follow after Diwali, this time possibly affecting mobile division jobs as well.