Samsung Ramps Up Spending to Meet Demand, Fuel Expansion

Samsung Ramps Up Spending to Meet Demand, Fuel Expansion

Samsung is ramping up spending and hiring in anticipation of high demand for its mobile processors this year, as the company hints at global expansion plans.

The South Korea-based company announced Monday its U.S. branch will sell $1 billion in bonds, its first overseas debt sale in more than a decade. The company will likely use capital raised by the five-year bond to fund mobile processor manufacturing operations in Austin, Texas, and finance production of next-generation OLED flat-screen displays.

The company is sending out requests for proposals for banks to manage the deal, according to a Samsung spokesperson.

At a time when global economic uncertainty has many device manufacturers cutting back on spending, staffing, and production, Samsung expects to invest a record-breaking $40 billion in its operation this year and hire 26,000 new employees.

Samsung’s spending and hiring sprees point to the company’s plans for creating a strong presence in the U.S. mobile market. Last fall, Samsung hired Kevin Packingham, former head of products at Sprint, to help push the company’s flagship Galaxy line into the U.S. and serve as a direct line between the company and wireless carriers.

Samsung is also pushing out several Android high-speed LTE phones to high U.S. demand this year, including Google’s flagship Galaxy Nexus.

If Samsung’s increased investment leads to greater sales of its processors, flat screens and smartphones in the U.S., it will continue to meet Apple on its home turf and possibly keep the lead it gained last year when it surpassed Apple in smartphone sales.

Despite being entangled in patent lawsuits with Apple in several counties, Samsung remains the primary chip maker for the Cupertino, Calif.-based company, and Apple is relying on the electronics giant to produce its next-generation A6 processor. Samsung’s increased spending this year will help make sure its mobile processor production meets high demand for both its own devices and Apple’s iPhones and iPads.

The company is also exploring a new strategy of offering content for mobile devices and connected televisions, showing it plans to broaden its reach beyond simply providing hardware to build a new presence in media. The company’s planned 2012 expenditures will help fuel these endeavors as well.

Analysts predict Samsung’s investment in mobile processors and sensors for smartphones and tablets will exceed its spending on memory chips for the first time this year, highlighting the company’s plans to capitalize on mobile devices’ growth to ensure a profitable future.

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