Thanks for the memories: Samsung CEO steps down as Q3 profits surge 179pc

13 Oct 201715 Shares

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

Samsung’s flagship Note8 device. Image: Karlis Dambrans/Shutterstock

Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Pin on PinterestShare on RedditEmail this to someone

Driven by its chip memory, display and handset businesses, Samsung says its Q3 outlook is rosy.

The CEO and vice-chair of Samsung, Kwon Oh-hyun, is stepping down just as the company is predicting operating profits of $12.8bn for the third quarter, up 179pc on last year.

The profits will be derived from revenues of $54.7bn in Q3. In its previous quarter, profits of $12.67bn exceeded Apple’s operating income of $10.7bn for the same period.

The strong performance comes as Kwon has decided to step down in the aftermath of the arrest and imprisonment of Jay Y Lee, head of Samsung Group, who was found guilty of bribery and embezzlement.

In a letter to employees, Kwon said that Samsung is “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.”

Toast a wee DRAM

Despite the musical chairs in Samsung’s leadership, the company has dusted itself down after the Note7 recall debacle of last year and is surging forward.

Its Note8 flagship device is being well received in the market and no doubt Samsung is preparing itself for a flurry of new product announcements in the run-up to the pivotal Mobile World Congress trade event in Barcelona early next year.

A major earnings driver for the South Korean electronics giant is its semiconductor business, which is benefiting from positive pricing trends, especially for dynamic random-access memory (DRAM) chips.

Samsung is also a major supplier of parts to Apple, so even when its competitor in the smartphone race is doing well, Samsung is doing well.

It is understood that Apple has ordered about 70m OLED display panels from Samsung for its new flagship iPhone X smartphones.

Samsung’s flagship Note8 device. Image: Karlis Dambrans/Shutterstock

Editor John Kennedy is an award-winning technology journalist.

editorial@siliconrepublic.com