Samsung Electronics CEO Announces Resignation Amid 'Unprecedented Crisis'

Samsung Forecasts Record Q3 Profits As CEO Announces Resignation Amid 'Unprecedented Crisis'

Samsung Forecasts Record Q3 Profits As CEO Announces Resignation Amid 'Unprecedented Crisis'

In his statement, Kwon said he made a decision to leave Samsung because the company is facing an "unprecedented crisis".

Kwon's sudden departure may be a calculated legal tactic to seek a softer punishment for Lee, said Shim Jung-Taik, an author of several books on Samsung and its corporate culture.

He is also vice-chairman, CEO of the device solutions business (chips and LCDs) and CEO of Samsung Display, and has been at Samsung for 32 years.

Samsung will lose another major executive soon.

But Samsung did not celebrate the news for long, following up the rosy earnings guidance by announcing the resignation of a top executive.

Earlier Friday, Samsung said its July-September operating profit almost tripled over a year earlier to a new record, putting it on track to report its best annual financial results.

He's likely referring to the arrest of Lee Jae-Yong, the de facto head of Samsung Group; the 49-year old leader was imprisoned in August after he was found guilty of bribery and embezzlement. "As we are confronted with unprecedented crisis inside out, I believe that time has now come for the company to start anew, with a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry". Analysts forecast Samsung's 2017 net income almost doubled from 2016 and they expect Samsung to outdo its annual financial results for the next few years, thanks to its position as the world's largest maker of the semiconductor group known as memory chips that are used for mobile devices and computer servers. Quarterly profits are forecast at 14.5 trillion won ($12.8 billion), an increase of almost 300% over the previous year. Sales jumped 30 per cent to 62 trillion won ($54.7 billion).

Samsung is expecting record profits for third quarter amid the high-flying memory chip prices.

Usually when Samsung announces management and organizational changes, they take effect immediately, according to SK Kim, an analyst with Daiwa Capital Markets. He will serve till his term as Samsung Electronics' chairman of the board ends in March 2018.

South Korea's largest company has been seeking to move past a bribery scandal that saw Lee thrown into jail, and to overcome a damaging recall a year ago of its flagship Galaxy Note 7 smartphone over exploding batteries. Hearings on his appeal and those of four other convicted Samsung executives began October 12.

Recommended News

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.