Samsung Electronics CEO resigns, says company is in "unprecedented crisis" ars_ab.settitle(1186199)


Samsung has two other CEOs, each overseeing its mobile phone business and home appliance division.

Samsung expects to pull in 62 trillion won ($54.9 billion) in revenue and 14.5 trillion won ($12.8 billion) in profit for the three months ending September 30, a near 300% increase in profit compared to the same period a year ago.

In a shocking announcement, Kwon Oh-hyun said he will step down as the South Korean tech giant's vice chairman and CEO of Samsung Display.

"Fortunately, the company is now producing best-ever results but this is merely a fruit of decisions and investment made in the past", he said in a statement.

In a letter to employees, Kwon noted that as the firm is "confronted with unprecedented crisis inside out, I believe that time has now come for the company start anew, with a new spirit and young leadership to better respond to challenges arising from the rapidly changing IT industry". The former South Korean President - Geun-Hye Park - had been impeached for accepting bribes in exchange for political influence. Samsung hasn't given out information on the timing of succession, nor did it share who will take on Kwon's responsibilities when he leaves next year.

Kwon added the company is facing a grave situation despite it making record-breaking earnings.

The big question this poses is: who else at the top of Samsung will also be contaminated by the scandal?

Lee Jae-yong is the son of Lee Kun-hee, the chairman of Samsung Group, and is seen as the company's heir apparent.

Sales are expected to have surged 29.65 per cent on-year to 62 trillion won, with the booming semiconductor business boosting the company's bottom line.

"The results are good ones that largely meet market expectations", Dongbu Securities Co analyst Kwon Sung-ryul said.

The boom allowed Samsung to dethrone Intel Corp., the long-time global chip leader, in the second quarter and has yielded record earnings for smaller chip rivals such as SK Hynix. This business generates more profits compared to smartphone and other businesses. Both Samsung and Apple recently released new flagship smartphones.

The consumer electronics division would also benefit from strong seasonal demand, he added.