Samsung fell behind rivals in semiconductor business, but vowed to turn crisis into opportunity

Samsung Electronics vice chairman and new head of Device Solutions, which produces semiconductors and displays, Jun Young-hyun apologized on behalf of the company after it published a disappointing third-quarter profit forecast.

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The world’s largest memory chip maker issued a forecast that its operating profit for the quarter ended September would be approximately 9.10 trillion won ($6.75 billion), while analysts expected 11.456 trillion won ($8.5 billion). The financial results of Samsung’s memory division were more modest due to “one-time costs and negative effects” – inventory adjustments by mobile device manufacturers and increased supplies of previous-generation products from Chinese memory manufacturers. Below is the full text of the apology from Samsung management, as quoted by CNBC.

«Dear customers, investors and employees who have always loved Samsung Electronics! Today, the management of Samsung Electronics would like to apologize first of all to you. We have raised doubts about our fundamental technological competitiveness and the future of the company by failing to meet market expectations. Many people talk about the Samsung crisis. We who run the business are responsible for all of this. Samsung, however, has always turned crises into opportunities, with a history of challenges, innovations and victories. Our leadership will take the initiative to overcome the crisis.

Above all, we will restore our fundamental technological competitiveness. Technology and quality are our lifeblood. This is the pride of Samsung Electronics, where we can never compromise. Instead of short-term solutions, we will ensure fundamental competitiveness. Moreover, I believe that only new technologies that do not exist in the world and competitiveness are the only ways for Samsung Electronics to return.

Secondly, we will prepare for the future more carefully. We will renew our passion to charge forward into the future without fear, stick to our goals to the end and achieve them. We will re-arm ourselves with a spirit of challenge to move towards a higher purpose rather than a defensive mindset to protect what we have.

Third, we will take another look at our organizational culture and practices and immediately fix what needs to be fixed. We will restore our traditional organizational culture of trust and communication. If we find problems on the ground, we will identify them for what they are and engage in vigorous discussions to overcome them. In particular, we will actively communicate with investors when the opportunity arises.

Dear clients, investors and employees! If we challenge ourselves, we are confident that we can turn the current crisis into a new opportunity. Please provide us with support and encouragement so that Samsung Electronics can once again show strength.

Thank you!” – Deputy Chairman of the Board of Directors, Head of Device Solutions Division Chung Yong Hyun.