Samsung cuts revenue and profit forecast after Note7 fiasco

Samsung Galaxy Note7
Samsung Galaxy Note7

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12 October 2016 | 0

Samsung Electronics has cut its revenue and profit forecasts for the third quarter, after the disastrous launch of its flagship Galaxy Note7, which led to the company recalling the smartphones and stopping their production in the wake of reports of overheating batteries.

The South Korean company said revenue for the quarter was likely to be about 47 trillion won ($4.2 billion), down from the 49 trillion won that it had expected earlier this month in a preliminary forecast. Operating profit is expected to drop by about 2.6 trillion won to 5.2 trillion won.

The company said it was revising its revenue and profit forecast because of the Note7 debacle.

Samsung said discontined production of the Note7 smartphone, after fires and even explosions were reported involving replacement units that had been issued after it was found that a battery-cell issue could lead to overheating and even fires in some of the Note7 phones shipped since mid-August.

The reduced revenue and profit forecast could reflect the lost business in the third quarter and the costs of the recall.

IDG News Service

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