Operating profit at Samsung between July and September 2016 has fallen sharply, after the recall and subsequent discontinuation of the Galaxy Note7 handset. Falling by 30%, operating profit at Samsung between July and September was $4.6bn, its lowest level in two years.
The Galaxy Note7 was initially recalled after multiple reports of the handset catching fire, but after the replacement units that were sent to customers were confirmed as having the same problem, Samsung decided to discontinue the device altogether and focus on its next generation of devices.
Confirming their mobile unit strategy after the Note7 problems, Samsung said they will be;
"expanding sales of new flagship products... as well as regaining consumers" confidence."
Regaining confidence will certainly be key to Samsung"s ongoing success in the mobile space. Analyst Greg Roh of HMC Investment Securities said;
"Samsung has lost consumer confidence, but I think it still has at least one more chance. Rather than rushing to release the next product, it should conduct a thorough inspection and explain the results of its investigation into the Note7"
As noted by Greg Roh, explaining the cause of the Note7 issue to consumers will be an important step in winning back confidence, though Samsung have stayed fairly quiet on the cause of the issue so far.
Perhaps after a speedy initial diagnosis that meant replacement devices were sent out with the same fault, Samsung has learned that a little haste can be helpful, even in the world of technology.
Source: BBC