Samsung Electronics logged today a record profit of $10.0 billion for July to September and announced a sweeping reshuffle within top management as the South Korean tech giant seeks to maintain its market lead while its heir is in prison. The world’s biggest memory chip and smartphone maker has faced multiple challenges since last year, including a humiliating recall of its flagship Galaxy Note 7 handsets and a corruption scandal that engulfed its de facto leader.
But its third-quarter net profits soared 148 percent on the same period a year ago, it said in a statement, thanks to strong demand for its memory chips and a recovery in smartphone sales with the roll-out of the new generation Galaxy Note 8.
The figures come only two weeks after chief executive Kwon Oh-Hyun resigned, saying the South’s biggest firm was facing an “unprecedented crisis” and its current profitability was “merely a fruit of decisions and investment made in the past”. The firm described Tuesday’s numbers as an “overall robust performance”.
Operating profit nearly tripled on-year to 14.5 trillion won — also a quarterly record — it said in a regulatory filing, while sales surged to 62.05 trillion won, another all-time high.
Samsung Electronics is the key subsidiary of the sprawling Samsung Group, whose heir Lee Jae-Yong was found guilty in August of bribery, perjury and other charges stemming from payments to the secret confidante of ousted president Park Geun-Hye. Lee, who was jailed for five years, says he is innocent and is appealing. The firm also announced Tuesday the first major reshuffle in its top leadership in three years. It had not made any radical changes at the top since group chairman Lee Kun-Hee suffered a heart attack in 2014 that left him bedridden. Samsung, which has a team of three CEOs each leading its semiconductor, mobile and TV units, said Kwon’s role as the head of the semiconductor business would be taken by Kim Ki-Nam, a younger manager in chipmaking operations.
Lee Sang-Hoon, known to be close to the group’s founding Lee family, will leave his position as the firm’s chief financial officer to take the chairmanship of the board, a role previously held by Kwon. Today’s announcement also saw HS Kim replacing Yoon Boo-Geun as the head of Samsung’s home appliance and TV unit, and DJ Koh replacing JK Shin as the mobile chief. The 2017 Galaxy Note 7 recall — due to exploding batteries — also dealt the firm a crippling blow to its mobile business.
But its profits and share price have rocketed this year, as global chip prices have soared with suppliers such as Samsung yet to catch up booming demand for high-powered processors used in handsets, computers and cloud storage servers.
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