This post has been updated to reflect the announcement of Oh-Hyun Kwon’s resignation.
Samsung Electronics made two announcements today that contrasted starkly with one another in tone. First, it issued an optimistic third-quarter earnings guidance. Then, a few hours later, it posted a resignation letter from chief executive officer and vice chairman Oh-Hyun Kwon, who said it is time for new leadership as the company faces an “unprecedented crisis inside out.”
In terms of earnings, the chaebol has had a good year so far, posting strong first and second-quarter results thanks to its components business, which Kwon also oversees. From a leadership perspective, however, Samsung has had a very difficult year. In August, Samsung vice chairman Jay Y. Lee, who was widely expected to replace his ailing father Lee Kun-hee as chairman of Samsung Group, was sentenced to five years in jail after being found guilty of bribery, embezzlement, capital flight and perjury charges.
Kwon, who began serving as Samsung Electronics’ CEO in 2012, also plans to leave his roles as the head of its components and display units and will not seek re-election to its board.
In a letter to employees, Kwon wrote that his resignation “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. 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.”
Kwon, who joined Samsung in 1985 as a researcher, added that it now “needs a new leader more than ever and it is time for me to move to the next chapter of my life.”
Despite the upheaval in its management ranks, Samsung was upbeat in its third-quarter earnings guidance today, forecasting consolidated operating profit of about 14.5 trillion Korean won ($12.8…