Samsung forecasts bumper profits as CEO resigns

Ann Santiago
October 14, 2017

"Because we are faced with an unprecedented crisis, I believe that the time has come, to a company headed by new leadership in order to better respond to the challenges arising in the rapidly changing IT industry", he said. 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.

Kwon, a semiconductor engineer, has met with President Moon Jae-in and attended events both at home and overseas since Lee was detained in February on corruption charges.

But in his resignation letter Kwon explained that because Samsung is facing "unprecedented crisis inside out", the time has come for the company to "start anew, with a new spirit and young leadership". "But 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". Indeed, the company expects record operating profits of about $12.8 billion for the third quarter. This would potentially represent a 178 percent increase year over year, even with the Note 7 recall offsetting much of the earnings.

Samsung Electronics' CEO has announced his surprise resignation from the company. The company is also expected to generate 62 trillion won or $54.7 billion in revenue. Samsung did not announce the performance estimates of each business division but its semiconductor business is widely believed to have contributed greatly to the record-beating report. Oh-Hyun Kwon will leave not only that post but also his positions as CEO of Samsung Display, head of the company's components arm, and Vice Chairman.

Analysts estimated 14.3 trillion won in operating profit according to financial data provider FactSet.

Analysts forecast Samsung's 2017 net income almost doubled from 2016.

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