Samsung is to restructure its mobile phone unit as sales slow because of fierce competition across its ranges.
The South Korean electronics firm made the announcement following the release of its results for the July to September quarter in which profits dipped to a near three-year low.
Net profit for the third quarter fell 49% to 4trn won (£2.5bn) while the mobile unit reported operating profit of 1.75trn won (£1bn) - a dramatic decline from 6.7trn won a year ago.
Its smartphone business - which accounts for more than half its total sales - has faltered under competition from Apple's iPhone6 and Chinese handset makers in an increasingly saturated market.
Apple's iPhone 6 models have proved popular
While it sold more units, Samsung sold them for less.
It said: "The average selling price of smartphones declined due to an increased share of middle- to low-end smartphone sales and price reductions of existing smartphone models."
The latest edition of Samsung's previously all-conquering Galaxy S smartphone met with a lukewarm response on its launch in April.
It was also forced to introduce a new edition of the oversized smartphone Galaxy Note earlier than scheduled in September as the latest iPhone6 from US rival Apple enjoyed better-than-expected demand.
And in the low-to-mid range smartphone segment, Samsung has faced a growing challenge from Chinese firms in key emerging markets including China.
Lenovo is among Samsung's Chinese competitors
Samsung saw its leading share in the global smartphone market slip to 25.2% in the second quarter of this year from 33.3% a year ago.
At the same time, Chinese firms Huawei and Lenovo saw their combined share grow from 9% to 12.3%.
Kim Hyun-Joon, senior vice president of Samsung's mobile unit, vowed to dramatically reshuffle product lineup to "actively respond" to the needs of the mid and low-end markets.
"Our mobile unit is going through a temporary difficulty, but we are trying to maintain a steady growth by ... fundamentally changing our business structure," he said.
The company promised earlier this month it would soon release a new range of smartphones with "innovative designs."
