Samsung has appointed billionaire Jay Y. Lee as president

Hong Kong/Seoul
CNN business

Samsung has named Jay Y. Lee, its longtime de facto leader, as executive chairman.

The move was announced on Thursday, making official who will continue to lead South Korea’s most valuable and popular company. Lee previously held the title of vice president.

Samsung’s board, which approved the change, “cited the current uncertain global business environment and the urgent need to strengthen accountability and business stability,” the tech giant said in a statement.

It comes just months after Lee, the son of one of South Korea’s most powerful families, was pardoned for crimes including racketeering and bribery.

In August, Lee was personally forgiven by the country’s president for his alleged wrongdoing, with officials citing an economic crisis that demanded the attention of his top employers.

The pardon ended Lee’s five-year ban from holding a formal position at Samsung. The millionaire was sent to prison twice, but was on parole since last year.

Lee, also known as Lee Jae-yong, has been working as Samsung’s de facto boss since 2014, after his father went into a coma after suffering a heart attack. Lee Sr. died in 2020.

This week, the younger Lee marked the second anniversary of his father’s death, vowing to “preserve his legacy” at a staff meeting on Tuesday.

“During this period, we have faced many challenges, and at times we have struggled to make progress,” Samsung said, according to a reading of the notes it shared with CNN Business. “We are definitely at a pivotal moment.”

“Now is the time to plan our next move,” added Lee.

The commitment is in line with an ambitious push announced by Samsung in May, which will see the conglomerate pour more than $350 billion into its businesses and create 80,000 new jobs over the next five years.

Most of the jobs are expected to be in South Korea, and the funds will mainly go into businesses such as chipmaking and biopharmaceuticals.

Samsung reported a 31% drop in operating profit on Thursday, registering nearly 10.9 trillion Korean won ($7.6 billion) in the third quarter from 15.8 trillion won ($11.1 billion) in the same period last year.

In its earnings call, the company warned that “weak demand for cell phones and TVs” was hurting its bottom line. While the company expects “a partial recovery in demand in 2023,” it said global economic pressures will affect its performance.

However, the band also enjoyed record sales. It said revenue reached 76.8 trillion won (nearly $54 billion) in the third quarter, despite a “difficult business environment,” and it still expects full-year revenue to exceed that of 2021.

Samsung shares rose nearly 1% in Seoul on Thursday after the announcement.

— CNN Seoul’s Yoonjung Seo contributed to this report.