Speaking to CNBC, DJ Koh was tight-lipped on how the folding screen could work but ran through the design thinking of the upcoming smartphone, particularly how Samsung is trying to differentiate the experience from a tablet once it is unfolded - a concept that was previously rumored to be in Samsung's plans.

"You can use most of the uses ... on foldable status. But when you need to browse or see something, then you may need to unfold it. But even unfolded, what kind of benefit does that give compared to the tablet? If the unfolded experience is the same as the tablet, why would they (consumers) buy it?," Koh said at the IFA electronics show in Berlin last week.

"So every device, every feature, every innovation should have a meaningful message to our end customer. So when the end customer uses it, (they think) 'wow, this is the reason Samsung made it'."

Samsung will not just release a device similar to a traditional flip phone, which relis on a hinge to connect the two parts of the handset. The company is focusing on creating an actual screen that bends. Samsung has been experimenting with bendable OLED displays for years, and the company first unveiled a prototype back in 2012.

Samsung released a concept ad for a potential foldable phone back in 2014. The ad featured a device with a bendable display that folded from a more tablet-like size into a pocketable phone. Samsung's device may include a 7-inch single display, according to a report earlier this year from The Wall Street Journal. The screen will reportedly fold in half like a wallet, with the exterior of the device displaying a small bar of information.

Koh hinted that more details of the device could be unveiled this year at the Samsung Developer Conference in November in San Francisco, but gave no indication of when a full launch would take place or when it might go on sale. The mobile CEO admitted that while the development process is "complicated," the company has "nearly concluded" it.

Samsung isn't the only company developing foldable devices. Lenovo is working on bendable phones and tablets, and Microsoft has been dreaming of a dual-screen Surface device for years.

Samsung is facing stiff competition from Apple and Huawei in the high-end of the market. A folding phone could differentiate it from its competitors and potentially allow it to charge a higher price for the unique device.

Koh also said that the company is changing its strategy in the mid-tier smartphone market to pack lower priced devices with new technology.

"In the past, I brought the new technology and differentiation to the flagship model and then moved to the mid-end," said Koh. "But I have changed my strategy from this year to bring technology and differentiation points starting from the mid-end."

The overhaul of Samsung's mobile strategy comes at a time when the company is facing increased competition from Chinese phone manufacturers including Huawei, Xiaomi, Vivo and OnePlus. Huawei in particular is proving a fierce competitor in the market, overtaking Apple to become the number two phone seller in the world last month.