Samsung Forecasts Record Q3 Profits As CEO Announces Resignation Amid 'Unprecedented Crisis'
Weird things can happen on Friday the 13th. Case in point, Samsung today announced its earnings guidance for the third quarter of 2017, saying it expects to a record operating profit of 14.5 trillion won (~$12.9 billion), compared with 5.2 trillion won (~$4.6 billion) during the same quarter a year ago. That is cause for celebration, though in a separate announcement, Vice Chairman and Chief Executive Officer Kwon Oh-hyun said it he plans to resign next year due an "unprecedented crisis" at Samsung.
That is a lot to digest. Starting with Kwon Oh-hyun's crisis comment, he did not offer any specifics, though he is undoubtedly referring to the imprisonment of Samsung's heir and de facto leader, Lee Jae-yong. He was arrested earlier this year on multiple charges of bribery, embezzlement, and perjury, and was ultimately sentenced to 5 years behind bars. That scandal apparently has taken a toll on others within Samsung, including Kwon Oh-hyun.
The outgoing CEO did not come to his decision lightly.
"It is something I had been thinking long and hard about for quite some time. It has not been an easy decision, but I feel I can no longer put it off," Kwon said "As we are 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."
Other than referring to Lee's scandal, Kwon reflected fondly on this more than three decades of service at Samsung. He expressed a "deep sense of pride and honor" in an emotional letter to employees, but ultimately concluded that now more than ever Samsung is need of a new leader, and that he is ready to embark on the next chapter of his life.
"There are no words to describe how proud I am that we built together one of the most valuable companies in the world. We have come a long way to create a company that truly changes how people live, work and communicate with each other," Kwon added.
Samsung is in a good place financially. With a diversified portfolio of products, the company was able to absorb the fallout from its Galaxy Note 7 recall, which now feels like ancient history with the Galaxy Note 8 having launched to eager fans. Including all product lines, Samsung expects to record around 61 trillion to 63 trillion won (~$54 billion to $56 billion) in sales during the third quarter.
That is a lot to digest. Starting with Kwon Oh-hyun's crisis comment, he did not offer any specifics, though he is undoubtedly referring to the imprisonment of Samsung's heir and de facto leader, Lee Jae-yong. He was arrested earlier this year on multiple charges of bribery, embezzlement, and perjury, and was ultimately sentenced to 5 years behind bars. That scandal apparently has taken a toll on others within Samsung, including Kwon Oh-hyun.
The outgoing CEO did not come to his decision lightly.
"It is something I had been thinking long and hard about for quite some time. It has not been an easy decision, but I feel I can no longer put it off," Kwon said "As we are 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."
Other than referring to Lee's scandal, Kwon reflected fondly on this more than three decades of service at Samsung. He expressed a "deep sense of pride and honor" in an emotional letter to employees, but ultimately concluded that now more than ever Samsung is need of a new leader, and that he is ready to embark on the next chapter of his life.
"There are no words to describe how proud I am that we built together one of the most valuable companies in the world. We have come a long way to create a company that truly changes how people live, work and communicate with each other," Kwon added.
Samsung is in a good place financially. With a diversified portfolio of products, the company was able to absorb the fallout from its Galaxy Note 7 recall, which now feels like ancient history with the Galaxy Note 8 having launched to eager fans. Including all product lines, Samsung expects to record around 61 trillion to 63 trillion won (~$54 billion to $56 billion) in sales during the third quarter.
