Samsung CEO Kwon to step down even as chip business thrives

Samsung CEO Kwon to step down even as chip business thrives

However, in a sign of good news for the company, its estimated operating profits for the third quarter of 14.5 trillion won (US$12.8 billion) marked a record for quarterly profit, almost tripling the 5.2 trillion won earned a year earlier.

In a letter sent to all employees, Kwon said that announcing his retirement was the most hard thing for him to do, but now was the right time and that he believes his decision is in the best interest of the company.

That crisis is believed to be related to the ongoing bribery scandal surrounding Samsung, which recently saw the arrest of the company's heir and vice chairman Lee Jae-yong (also known as Jay Y Lee).

Kwon's sudden departure may be a calculated legal tactic to seek a softer punishment for Lee, said Shim Jung-Taik, an author of several books on Samsung and its corporate culture.

"(The earnings) are based on investment made in the past.

In the year since the Galaxy Note 7 debacle, Samsung has had to work hard to get its business back on track.

Lee, who was found guilty in August of bribery, perjury and other charges relating to payments made by Samsung to the secret confidante of ousted president Park Geun-Hye, is appealing his five-year sentence and says he is innocent. "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". However, thanks to devices like the Galaxy S8 and the recent Galaxy Note 8 along with thriving component sales, the company is now forecasting record profits, eclipsing even those of its biggest rival, Apple.

The company is set to release its final earnings report later in October.

Kwon announced his decision in a letter to Samsung employees.

Operating profit was estimated at 14.5 trillion won ($12.8 billion), compared with 5.2 trillion won tallied a year earlier, the company said in a regulatory filing.

However, Samsung's legitimate business would appear to be ticking over nicely, with the company revealing its financial forecasts for the rest of the year.

The consumer electronics division will also benefit from strong seasonal demand, he added.

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