Published in Processors

Samsung’s "Mr Chips" CEO shocks with surprise resignation

by on13 October 2017


Goodbye Mr Chips

CEO and Vice Chairman Kwon Oh-hyun has shocked analysts with a surprise plan to step down from management – just after announcing stonking profits.

The surprise resignation of Samsung’s chip and display head came as he was expected to take a bigger role following Lee’s arrest in February and the departures of other key executives in the wake of the bribery scandal.

The South Korean smartphone maker forecast record third quarter operating profit on the back of the memory chip business which Kwon was instrumental in building into the world leader.

Samsung also said that things were going to be better in the fourth-quarter, and all that was due to Kwon’s components business.

Kwon, 64, is seen as Samsung Group No. 2. As well as being chairman of the board and a board director, he heads the components business - including memory chips - and the display business.

In a statement, the man known as “Mr Chips” said the time had come to “start anew with new spirit and young leadership”.

“We are fortunately making record earnings right now, but this is the fruit of past decisions and investments; we are not able to even get close to finding new growth engines by reading future trends right now”, he added.

The world’s biggest maker of memory chips, smartphones and TVs is set to smash its annual profit record this year, thanks partly to soaring demand for memory chips. Semiconductors were Samsung’s top earner in the three months through June, making a record $7.20 billion.

Shares in Samsung, worth about $310 billion, fell 1.5 percent on Friday after hitting an all-time high earlier in the day.

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.

Choi Gee-sung, Jay Lee’s mentor, quit earlier this year for his alleged role in the bribery scandal, and Samsung Electronics now needs to fill several more key roles with Kwon’s exit.

Kwon would serve out his term as chairman of the board and board director until March 2018, the company said. He is also not stepping down immediately from his two other roles.

 

Last modified on 13 October 2017
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