Samsung CEO to resign despite record Q3 earnings

by Harriet Bell October 14, 2017, 0:26
Samsung CEO to resign despite record Q3 earnings

The departure of 32-year Samsung veteran Kwon after five years in the top job comes at a time of leadership uncertainty at the company. "It has not been an easy decision, but I feel I can no longer put it off", Kwon said in his letter. Vice chair Lee Jae-yong, vice chair and heir to the company's controlling family, was arrested in February this year under charges of bribery including payments of around £29 million to Choi Soon-sil, confidant of South Korea's President Park Geun-hye, in exchange for the backing of a merger between two Samsung subsidiaries which chair Lee Kun-hee used to transfer control of the company to Jae-yong. Lee Jae-yong's conviction was part of a bribery scandal that reached all the way to the president of South Korea, Park Geun-hye, who was impeached past year is also serving time in prison.

The "unprecedented crisis" that Kwon may be alluding to is the arrest of Lee Jae-yong, the de facto leader of the Samsung.

In a letter sent to all employees, Kwon said that announcing his retirement was the most hard thing for him to do, but now was the right time and that he believes his decision is in the best interest of the company.

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"[Samsung] has been showing record performances", Kwon said.

"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.

Samsung did not name a successor to Kwon.

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Samsung Electronics says its third-quarter profit likely surged almost three-fold over a year earlier to a new record high.

Kwon first joined Samsung back in 1985 as a researcher of the company's Semiconductor Research Institute in the US.

Mr Kwon would serve out his term as chairman of the board and board director until March next year, the company said.

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The release of new models, including the iPhone X by rival Apple Inc could weigh on Samsung's mobile sales, but will also help its smartphones parts business, Mirae Asset Daewoo Securities Co analyst Doh Hyun-woo said in a report.


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