Samsung CEO apologizes for sluggish phone performance

Samsung Electronics Vice Chairman and CEO Han Jong-hee speaks at a shareholder meeting held at the Suwon Convention Center in Gyeonggi Province, Wednesday. (Yonhap)

Samsung Electronics vice president and co-CEO Han Jong-hee apologized on Wednesday for escalating disputes over performance issues with the tech giant’s latest flagship, the Galaxy S22.

“We have been unable to properly consider the needs of our consumers,” Han said as he bowed deeply in apology to some 1,600 shareholders attending an annual general meeting in person and online.

It was the first time a senior Samsung executive has publicly apologized amid growing complaints about the latest smartphone’s controversial game optimization service.

GOS is software that adjusts smartphone performance to help batteries last longer and avoid overheating issues when using apps that use a lot of phone resources.

Samsung has installed the software since the launch of the Galaxy S7 series in 2017, but it was previously an option that could be disabled by user choice. For the latest S22, however, the software has been enabled automatically, even for other popular apps.

As a result, the software limited the phone’s overall performance to just 53.9% of its promised capacity, according to Geekbench, a global platform that measures smartphone performance. The platform recently removed recent Samsung phones and tablets from its review list, citing the credibility issue.

Samsung announced last week that it would fix the problem with a software update, but public anger has shown no signs of abating.

As widely expected, the latest controversy topped the agenda at Wednesday’s general meeting, with shareholders criticizing top management for mishandling the issue, calling for countermeasures.

“The GOS was designed to optimize the performance of the phone taking into account the various characteristics of gamers,” Han said. “Consistent device performance is crucial when enjoying high-end gaming, so we’ve throttled CPU and GPU performance to appropriate levels to minimize overheating while maintaining consistency.”

“We will listen more carefully to the voice of our users and reward them with the best quality and service so as not to repeat similar problems,” he added.

Asked about safety issues related to overheating following the software update, Han said, “We will ensure safety by using a heat control algorithm. We will continue to add new functions to prevent overheating.

Other sensitive issues were also raised during the meeting.

Regarding Russian operations, the CEO said the company, which had already suspended shipments to the country, was closely monitoring the situation to minimize the impact on its business. Samsung is the leading smartphone maker in Russia, with a market share of almost 35%.

He added that the company was open to mergers and acquisitions, regardless of the sector and the size of the transaction, if they are considered useful for its sustainable growth and increased shareholder value.

Han identified artificial intelligence and 5G-based auto parts as one of the lucrative new growth drivers, suggesting the company was also betting big on the still-nascent metaverse.

Faced with internal and external challenges, Samsung suffered a nearly 30% drop in its stock price. Compared to a year ago, when the price hit an all-time high of 91,000 won, the stock is currently hovering around 70,000 won.

The company said it will pay out dividends worth 9.8 trillion won every year to boost shareholder value.

During the day, the appointments of the four new members of the internal board of directors – Kyung Kye-hyun, co-CEO who oversees the chip division, Roh Tae-moon, the head of mobile business, Lee Jeong-bae, the chief of the memory chip business, and Park Hak-kyu, president of management support – were approved by a majority.

Kan Han-jo, a financial expert who is currently chairman of the Hana Financial Group Foundation, was named chairman of the board, becoming the second external board member to hold the position.

By Lee Ji-yoon ([email protected])