Samsung seems to have redeemed itself with its third quarter operating profit, which rose to $7 billion during July-September quarter, registering a 5.55 percent rise from the previous year, beating market expectations. However, it is still down 4.18 percent over the previous quarter which was the largest in over two years for the South Korean behemoth, according to IANS.
The rise in operating profit was due to sales of semiconductors and display panels, the report said, quoting analysts.
In news currently, Samsung got singed after a large number of its recently-launched Galaxy Note 7 smartphones caught fire while charging. It also led to as many as 92 reports of battery overheating, 26 cases of burns and 55 involving property in the US alone. Airlines in the US decided to play it safe by preventing passengers from carrying phones on flights amid fears of a fire hazard from batteries.
Samsung’s ability to build a great phone is beyond question, going by its past records. However, the Note 7 fiasco is putting its reputation at stake.
It is estimated that Samsung may report about 1 trillion won in losses from the Note 7 recall, and the exact impact on its earnings would be reported later this month after an external audit.
The firm won't issue full results until late October and gave no details on the cost of recalling about 2.5 million Galaxy Note 7 phones after batteries caught fire, according to Reuters.
"Obviously the Note 7 recall costs were reflected but (business) segments such as memory and OLED (organic light-emitting diode) displays did well and will probably continue to do so until at least next year," said IBK Asset Management fund manager Kim Hyun-su.
Ironically, the Note 7 problems could also boost Samsung's chip business. Industry executives say the sudden need for chips in 2.5 million replacement phones is exacerbating in an already tight memory market conditions, which could push prices higher.
The company could get into trouble further if there is a second recall, a very unusual move that would be, if it is found that the company gives a `replacement device' to the owner whose phone caught fire aboard a plane, according to two former US safety officials, reportedGadget 360.
Published Date: Oct 07, 2016 02:58 pm | Updated Date: Oct 07, 2016 02:58 pm