Goodbye Mr Chip: Samsung Electronics Boss Quits

Goodbye Mr Chip: Samsung Electronics Boss Quits

Samsung Electronics' vice chair and chief executive has resigned warning the South Korean tech giant is in the throes of an "unprecedented crisis".

Kwon Oh-hyun announced his decision to step down on the same day as the firm forecast record quarterly profits, thanks to a continued boom in the memory chip industry.

It comes just six weeks after the billionaire heir to the Samsung empire - Lee Jae-yong - was jailed for five years after being convicted of offering bribes to South Korea's former president, Park Geun-hye. He is appealing the sentence and says he is innocent.

The 65-year-old has been with the company for 32 years, and CEO of the company's hugely successful components business - including memory chips - since 2012.

"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 in the rapidly changing IT industry," said the man known as "Mr Chip".

"Now, the company needs a new leader more than ever and it is time for me to move to the next chapter of my life."

He added: "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."

In its earnings preview, Samsung put its July to September operating profit at 14.5 trillion (£9.64bn), compared with 5.2 trillion (£3.5bn) a year earlier. Sales are expected to have jumped 30% to 62 trillion (£41.2bn).

"The timing is nonsensical. Samsung tipped record earnings, it's going to be better in the fourth-quarter, and all that's been driven by Kwon's components business," said Park Ju-gun, head of research firm CEO Score.

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

In August, the smartphone giant looked to leave its exploding phone disaster behind with the launch of its new Galaxy Note 8.

It was forced to suspend sales of its Galaxy Note 7 last year after some caught fire when the battery exploded.

Mr Kwon will remain on the board of Samsung Electronics until March 2018.

Source: Sky News