Samsung Electronics makes rare mid-year change of leadership, appoints memory chip veteran as head of DS business unit

On May 21, according to foreign media reports, Samsung Electronics, which usually makes large-scale adjustments to senior executives at the end of the year, unexpectedly replaced the head of the Device Solutions (DS) department responsible for the semiconductor business today. Jun Young Hyun replaced Kyung Kyehyun who took office at the end of 2021.

Samsung Electronics has announced on its official website the appointment of Jeon Young-hyun as the new head of the Device Solutions Division. He will lead semiconductor businesses including memory chips and foundry to enhance their competitiveness in an uncertain global business environment.

Like many of the previous heads of Samsung Electronics Device Solutions who were veterans in memory chips, the newly appointed Jeon Young-hyun has also worked in the memory chip field for many years. He joined Samsung Electronics in 2000 and worked on DRAM and flash memory R&D and strategic marketing. In 2014, he became the head of the memory business. In 2017, he became the CEO of Samsung SDI, which is responsible for the battery business. Before this adjustment, he was in charge of Samsung Electronics' future business department.

Samsung Electronics also disclosed on its official website that Kyung Gye-hyeon, who has been in charge of the device solutions department since the end of 2021, will become the head of the future business department and lead Samsung Research Institute. It is expected that he will focus on finding new growth opportunities with his experience in leading the semiconductor business.

Samsung Electronics' executive adjustments are usually made at the end of the year, not in the middle of the year. Qing Guixian was appointed president and CEO at the end of 2021 and led the device solutions department. At that time, he was appointed with Vice Chairman and CEO Han Jong-hee, who led the SET department after the merger of consumer electronics, mobile business and other departments. This department was later renamed the Device Experience Department.

Samsung Electronics has replaced the heads of departments such as device solutions twice before, and the heads of major business departments were replaced together. In the high-level adjustment in November 2017, Kim Ki-nam replaced Kwon Oh-hyun as the head of the device solutions department; Ko Dong-jin replaced Shin Jong-kyun as the head of the mobile communications and IT department; Kim Hyun-seok replaced Yoon Boo-geun as the head of the consumer electronics department. In the adjustment at the end of 2021, Kim Ki-nam, Ko Dong-jin and Kim Hyun-seok resigned as the heads of the three major business departments and handed over the baton to Han Jong-hee and Kyung Gye-hyun.

Samsung Electronics' rare replacement of the head of its device solutions department in the middle of the year is most likely related to poor market demand and declining performance since the second half of 2022.

The device solutions division is Samsung Electronics' main source of profit, but due to the reduced demand for memory chips due to the decline in demand for consumer electronics products, the revenue and operating profit of this business division of Samsung Electronics have declined significantly since the second half of 2022. In the four quarters of last year, it suffered operating losses for four consecutive quarters, with an operating loss of 14.88 trillion won for the whole year, and an operating profit of 23.82 trillion won in 2022.

In the first quarter of this year, although the revenue and operating profit of Samsung's electronic device solutions division increased both year-on-year and month-on-month, the revenue of 23.14 trillion won and the operating profit of 1.91 trillion won were still significantly different from the 26.87 trillion won and 8.45 trillion won in the first quarter of 2022, especially the operating profit.