Samsung CE Strategy

- Sustainable Growth and Value Creation -

Disclaimer

The materials in this report include forward-looking statements which can generally be identified by phrases such as Samsung Electronics (SEC) or its management "believes," "expects," "anticipates," "foresees," "forecasts," "estimates" or other words or phrases of similar implications. Similarly, such statements that describe the company's business strategy, outlook, objectives, plans, intentions or goals are also forward-looking statements. All such statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in the presentation files above. For us, particular uncertainties which could adversely or positively affect our future results include: The behavior of financial markets including fluctuations in exchange rates, interest rates and commodity prices Strategic actions including dispositions and acquisitions Unanticipated dramatic developments in our major businesses including CE (Consumer Electronics), IM (IT & Mobile communications), DS (Device Solutions) Numerous other matters at the national and international levels which could affect our future results These uncertainties may cause our actual results to be materially different from those expressed in this report.

Consumer Electronics

Closely Tied to Peoples Daily Lives

Consumer Electronics

Imagine Your Home Without CE Products

Consumer Electronics

Brand Reliability Comes First

Product Replacement Cycle

14.0

15.9

7.2
5.0 1.8 years

Mobile
Source : IMS Research(USA), Internal Analysis

Note PC

TV

Refrigerator

Washer

Consumer Electronics

Potential to Lock-in Customers

The First Purchase

Additional Purchase

Full Package

Consumer Electronics

Experience Samsung Brand Everywhere!

Kitchen Living Room

Laundry Room

Portable

Key Questions

Is TV biz able to generate sustainable growth?

Can HA biz turn into the Samsungs next driver?

Business Opportunity - TV

TV Demand Growing Consistently

114

Analog Switch-off 98

105

96 83 $67B

Pull-in Effect

06

07

08

09

10

11

12

13

14

15

16

Source : Display Search FPTV (Revenue)

Business Opportunity - TV

UHD TV Market Ready to Explode

17.1
Full Line-up

11.1 5.6
1.2M Units
13
Source : Display Search

5X
14 15 16

Business Opportunity - TV

Fast Growing Premium Segment

60 FPTV

1.9M
(28%)
Emerging Developed

4.8M
(72%)

6.7M

5.5M
(60%)

9.1M

3.6M
(40%)

Source : Display Search (Unit)

13

16

Business Opportunity - TV

Fast Growing Premium Segment

Smart TV

32M
(30%)

107M
25M
Emerging Developed

75M
(70%)

(34%)

73M

48M
(66%)

Source : Display Search (Unit)

13

16

Business Opportunity - TV

Emerging Market, Driving New Momentum

Analog Switch-off Plan
for Over 15 Countries

+
66

65 $39B

61

09

10

11

12

13

14

15

16

Source : Display Search FPTV (Revenue)

Business Opportunity - HA

Continuously Growing Market

306

264 $188B

06

07

08

09

10

11

12

13

14

15

16

Source : Euromonitor, GfK, BSRIA, Internal Analysis

Business Opportunity - HA

Increasing Appetite for Value-added Products

Better Quality of Life

Growing Desire for Premium Product

Increasing Average Price

Business Opportunity - HA

Increasing Appetite for Value-added Products

High End Large Capacity Energy Efficiency

47
Market Portion

70 26
15 4% 20% 57

33

25%

10

13

15

10

13

Future

10

13

15

* REF priced over $2,000 (USA)

* Washer over 8kg (Germany)

* Inverter A/C (China)

Source : Traqline, GfK, JARN, Internal Analysis (Revenue)

Business Opportunity - HA

Fragmented Market with Regional Players

Business Opportunity - CE Total

Tremendous Addressable Opportunities

CE Strategy - TV

Samsung TV Seized the Initiative

CE Strategy - TV

Leading the Industry Trend

2006 Bordeaux

2009 LED TV
2011 Smart TV

2012 Smart Interaction

Worlds Largest

Timeless Design

- 25 -

Evolution Kit

- 26 -

Unparalleled Picture Quality

Curved Design

CE Strategy - TV

Global No.1 for 8 Consecutive Years

31
19%
Company A 18

13%
Company B

11%
06 08 10 12 13.1H

Source : GfK, NPD (Revenue)

CE Strategy - TV

No.1 Market Share on Key Regions

38%
Europe

21%
Asia Pacific

29%
N. America

36%
M. East & Africa

30%
L. America

Source : GfK, NPD (Revenue) 13.1H

CE Strategy - TV

Leading the Premium Market

Market Share of 60
38

Market Share of $2,000

37
28%
28
CompanyB

48
37

23%
CompanyA

26

18%
09 10 11 12 13

18%

17
10 11 12

12

09

13

Source : GfK, NPD (Revenue) 13.3Q Cumulative

CE Strategy - TV

The Most Preferred TV Brand

2013
Rank Company Preference

1 Samsung 32.7
2 3 4 Company A D B 22.0 12.1 7.0

(Most Preferred Single Answer)

Source : Internal Analysis, TNS

CE Strategy - TV

Recent Challenges Surrounding TV Business

Major TV Competitors

2nd-Tier TV Set Makers

IT Companies
with New Devices

CE Strategy - TV

Lead the UHD Category

Highest Picture Quality

Size Leadership
Multiple Form Factors

CE Strategy - TV

Reinforce Our Core Competencies

Cutting-edge Technology
Innovative Design

Various Line-ups

CE Strategy - TV

Bring New Experience

Easier & Faster User Interface

Differentiated Content & Service

CE Strategy - TV

Provide Best Shopper Experiences

Story Zone
(In-store Display)

Culture Marketing
(France Nuit Blanche Festival)

CE Strategy - TV

Future TV

CE Strategy - HA

Home Appliances Industry is

Analog 14.0 Local Preference Heavy Investment

x2 Investment
Europe America

Replacement Cycle

Asia

1.8 years

Mobile

Refrigerator

TV

Refrigerator

CE Strategy - HA

Slow Moving Industry

Few Technology Breakthrough in the past

Refrigerator

Washer

Air-conditioner

Time to Change the

CE Strategy - HA

Innovate the Marketplace

Boost up Customer Desire
14.0 years 15.9

Enlarge Market Size

Refrigerator Washer

Demand

Samsungs Innovative Products

CE Strategy - HA

A Quantum Leap through Innovation

Samsungs

CE Strategy - HA

Refrigerator

Create a New Premium Category

New!

1990

2003

2012

2013

2014~

?
Side-by-side French-door

T-type

Food Showcase Future REF

Capacity Innovation

Same Frame, More Space

T9000

Smart Storage Solution

Incase

Showcase

Unorganized

Food Showcase

New Embedded Feature

Sparkling Refrigerator

CE Strategy - HA

Washing Machine

Lead the Green Technology Paradigm

Performance
Upgrade

Energy

Water

CE Strategy - HA

Washing Machine

Lead the Green Technology Paradigm

?
2014 W9000

CE Strategy - HA

Air-conditioner

Provide Total Air Solutions

Commercial Indoor Air Quality

Residential

Cooling/ Heating

Design Innovation

Spring

55% Summer
Cooling

Fall Q9000

Winter

Air-purifier
Q9000

Conventional Virus Doctor Humidifier

Unlimited Applications
Easy Installation Energy Leadership
with Inverter Technology

Largest Capacity

Shopping Mall
(Hungary)

Stadium
(Germany)

Airport
(China)

Resort
(Turkey)

Office Building
(Qatar)

CE Strategy - HA

Vacuum Cleaner

Create Cutting-edge Products

Canister/Upright

Motion Sync Design

CE Strategy - HA

Vacuum Cleaner

Create Cutting-edge Products

Robot Cleaner

CE Strategy - HA

Kitchen Appliances

Deliver the Premium Kitchen Package

Large Market Potential Core of a Premium Brand

Total Market

$70B
(Refrigerator $80B)

Built-in Premium Home Package Appliances

CE Strategy - HA

Kitchen Appliances

Deliver the Premium Kitchen Package

Oven Hood Cooktop Microwave Oven

New Cooking Experience

Dish Washer

Dual Cook

Oil-free Fry

CE Strategy - HA

Establishing a Global Business Foundation

7 manufacturing sites in 2008

12 manufacturing sites in 2013

Russia Poland Korea Vietnam Brazil

China
Malaysia India

Mexico

Thailand

CE Strategy - HA

Discovering Deep Local Insights

5 Lifestyle Research Lab

London Beijing San Jose New Delhi

Singapore

CE Strategy - HA

Premium Marketing to Raise Value

Club des Chefs

Collaboration Marketing
(with Furniture Company)

CE Strategy - HA

Premium Marketing to Raise Value

CE Strategy - HA

Excellent Reviews across the World

Best of the year 2013
Side-by-side French Door Sparkling REF Dryer
(Electric/Gas)

1 Samsung 76
2 Company A 75 3 B 74
Source : Consumer Report (Nov 2013)

1 Samsung 84
2 Company A 83 2 B 83

Picked as

Spotlight

Excellent
Grade

CE Strategy - HA

Excellent Reviews across the World

Top Ranked
for 5-Consecutive Year
Washer

Samsung
Company A B C
Source : J.D.Power 2013 Laundry Appliances Satisfaction Study (Aug 2013)

822
818
808 783

CE Strategy - HA

HA Business will Jump Up to No.1

Performance

Innovation to Influence
Peoples Lifestyle!

Speed of Innovation

Time

Highlight of Samsung CE

Samsung CE Vision