Samsung Q3 profits take a nosedive; drops by 16.8% thanks to the Galaxy Note 7 fiasco

South Korean tech giant Samsung Electronics’ net profits in the third quarter dropped by 16.8 per cent, primarily due to problems with the Galaxy Note 7 for which a massive recall had to be issued in September, the company announced on Thursday. Operating profit dropped 29.7 per cent from a year earlier to 5.2 trillion won ($4.6 billion) in the July-September quarter. From three months ago, the profit tumbled 36.2 per cent, Xinhua news agency reported. It marked the lowest in two years, meeting the revised estimate by Samsung which slashed its preliminary forecast by 2.6 trillion won to reflect costs from the discontinuation of its fire-prone smartphone. Scores of reports about Note 7 phones heating up and catching fire led Samsung to terminate its latest flagship model. Hundreds of owners of the device here have sued Samsung for inconveniences they experienced in the recall and termination process. The company’s revenue declined 7.5 per cent over the year to 47.82 trillion won in the September quarter, the lowest since the first quarter of last year. From the previous quarter, the revenue was down 6.1 per cent. Net income dropped to 4.54 trillion won in the third quarter from 5.46 trillion won a year earlier. From three months ago, the net income plunged 22.4 per cent. IANS