"We are in a desperate situation. The reality before us is severe, and the market is harsh." These were the words of Lee Jae-Yong, chairman of Samsung Electronics, upon his inauguration in October 2022. Four years later, Samsung Electronics has achieved the top position in global operating profit. This turnaround follows a significant loss in the semiconductor sector in 2023, prompting a renewed focus on Lee's leadership, which has maintained a steady course in technology investment and business strategy despite challenges.
As Lee marks his fourth anniversary in office on October 27, he took over during a particularly tough business environment. He effectively assumed control after the sudden incapacitation of former chairman Lee Kun-Hee in 2014, but faced significant challenges, including imprisonment related to the 2017 corruption scandal. The Future Strategy Office, responsible for key decision-making at Samsung, was disbanded that same year. Even after the passing of the former chairman in 2020, legal issues persisted, and on the day of his promotion to chairman in 2022, he attended court instead of a ceremony.
During this period, the semiconductor industry faced a crisis. In 2023, the semiconductor division reported an operating loss of 14.88 trillion won, and the leadership in high-bandwidth memory (HBM), crucial for AI semiconductors, shifted to SK Hynix.
The external environment was equally challenging. The Trump administration increased tariff pressures on key South Korean exports, including semiconductors and automobiles, while the U.S.-China tech rivalry complicated operations in China.
Despite these adverse conditions, Lee focused on restoring memory competitiveness. In May 2024, he appointed Vice Chairman Jeon Young-Hyun to lead the semiconductor division and reorganized the team to integrate HBM design, process, and packaging expertise. In February of this year, Samsung successfully became the first company to mass-produce HBM4 technology, marking a significant technological achievement. Anticipating increased investment in AI infrastructure, proactive investments in DRAM have led to substantial growth.
Additionally, efforts to expand investments in the U.S. have helped alleviate tariff pressures, yielding positive results in private diplomacy. Analysts note that these achievements have influenced the domestic export landscape beyond just company performance.
One of the pivotal moments in Lee's leadership was his decision to dismiss rumors of a foundry spin-off. By adhering to a comprehensive semiconductor strategy, Samsung secured a 22.8 trillion won foundry contract with Tesla and established operational foundations for its Taylor, Texas, facility.
Last July, the resolution of legal burdens with a not guilty verdict in the unfair merger and accounting fraud case cleared uncertainties surrounding management. With these challenges behind, Samsung Electronics has set new quarterly operating profit records this year, reaching 57.2 trillion won in the first quarter, 89.4 trillion won in the second quarter, and 107.4 trillion won in the third quarter, totaling 254 trillion won for the first three quarters.
This year, analysts project an operating profit consensus of 367 trillion won, positioning Samsung to surpass Nvidia on an annual basis. Under Lee's leadership, the company has risen to a solid foundation, with the prospect of becoming the world's leading company in annual operating profit within four years.
* This article has been translated by AI.
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