Samsung SDS said it will focus this year on using its 640 billion won in cash holdings for investments related to artificial intelligence (AI) data centers and mergers and acquisitions (M&A) of corporations with AI capabilities specialized by industry.
Chief Executive Officer (President) Lee June-hee of Samsung SDS said at the 41st annual general meeting of shareholders held at the Samsung SDS campus in Jamsil, Seoul, on the morning of the 18th, "As we judge this year to be a pivotal time that will determine leadership in the AI and cloud markets, we will prioritize using our cash holdings for capital expenditures (CAPEX) and M&A with a focus on growth."
That day, Samsung SDS presented a mid- to long-term investment roadmap and business strategy centered on AI and cloud. President Lee June-hee said, "To secure future growth engines, we are promoting the AI data center business and the data center DBO (design, build, operate) business as new businesses, and through this, we will lay the foundation for expanding Samsung SDS's AI services," adding, "We are also reviewing areas such as stablecoins and physical AI on the premise of commercialization." In digital logistics, the company plans to apply AI-based automation technology across the business to strengthen competitiveness.
Last year, Samsung SDS posted 13.9299 trillion won in revenue and 957.1 billion won in operating profit. Lee said, "The cloud business has surpassed 41% of revenue in the IT services institutional sector, and the business structure is being reorganized around cloud and Generative AI."
In line with its growth-focused investment strategy, Samsung SDS will pursue facility investments and M&A related to AI data centers this year. Lee said, "We are currently promoting the construction of new AI data centers, including the Gumi AI data center and the National AI Computing Center, and we plan to invest in GPU-dedicated servers and equipment for AI services at the west wing of the Dongtan data center, which opened in January this year."
It also said it will proceed with investments in industry-specialized IT corporations as the form of the recent cloud business shifts from infrastructure migration to conversion of business systems by industry. Lee said, "To proactively respond to growth in the AI market, we are also reviewing investments in AX (AI transformation), AI security, and companies with GPU infrastructure technology."
The agendas submitted at the meeting—approval of financial statements, partial amendments to the articles of incorporation, appointment of inside and outside directors, appointment of Audit Committee Commissioners, and approval of the limit on directors' remuneration—were approved as originally proposed.
With the passage of the agenda to amend parts of the articles of incorporation, the term of Samsung SDS directors changed from the existing three years to "shall not exceed three years," and the issuance limit for convertible bonds (CB) will be expanded 22-fold, from 67 billion won to 1.5 trillion won.
Earlier, the Samsung SDS Minority Shareholders' Alliance took issue with the clause on "shortening directors' tenure" ahead of the meeting and demanded that the board stop attempts to neutralize cumulative voting. With the promulgation of the Commercial Act amendment aimed at strengthening the rights of ordinary shareholders, if cumulative voting is implemented, minority shareholders will be able to cast bloc votes for a specific candidate to gain entry to the board. The alliance said Samsung SDS is effectively trying to neutralize cumulative voting by shortening directors' terms to one to three years. It argued that staggering directors' retirement dates reduces the number of directors appointed at one time, thereby lowering the total voting rights of minority shareholders.
That day, Samsung SDS appointed Lee Jae-jin, dean of the Seoul National University Graduate School of Data Science, as an outside director, and Kim Tae-ho, head of management support at Samsung SDS, as an inside director. For outside directors on the Audit Committee, it appointed Moon Moo-il, managing partner at Shin & Kim LLC, and Park Jung-su, a professor in the Department of Economics at Sogang University.
Although the independence of one outside director candidate slated to become an Audit Committee Commissioner was controversial at first, it was approved at the meeting without opposition. Some shareholders had raised the possibility of a conflict of interest over legal advisory transactions between Shin & Kim LLC, where outside director candidate Moon Moo-il serves as managing partner, and Samsung SDS.
Lee said, "This year, we will strengthen execution in the AI business centered on the AX Center and rapidly expand external business through strategic partnerships with global corporations."