Samsung profits snipped by Note 7 fiasco

Notably, the loss in profit is estimated to reach $2.2 billion in the fourth quarter of 2016 and $890,000 in the first quarter of 2017.

Earlier on October 13, after deciding to suspend the sales of Note 7 units, Samsung also decided to adjust its revenue and profit plans for the third quarter of 2016. Accordingly, the revenue target will decrease by $2 billion, to $42 billion, and the profit target will decrease by almost two thirds to $4.7 billion.

In the upcoming time, Samsung will recover its market share of the mobile phone trading sector via expanding its distribution of Galaxy S7 and Galaxy S7 Edge units, which were launched in March 2016. In addition, it will focus on enhancing the safety of its next mobile phone models.

After several batteries exploded while charging, the Federal Aviation Administration officially banned passengers from turning on their Note 7 devices on flights, while according to the regulation, passengers are only recommended to switch their mobile phones to airplane mode on flights.

In its latest move, national carrier Vietnam Airlines has officially refused to transport Note 7 devices in any way in cargo since October 17 due to fire hazards.

Earlier on September 11, Vietnam Airlines announced that it will not transport Note 7 devices through checked baggage and banned passengers from charging their Note 7 units on flights.

On October 11, Samsung called a worldwide halt to the sales and exchange of its Note 7 smartphones, citing continued safety concerns, and advised all customers to stop using the device immediately.

In Vietnam, according to Vietnam Competition Authority (VCA)’s report, as of October 17, over 8,000 of the 12,633 Note 7 devices sold in the country have been recalled.

On October 18, Samsung starts recalling the units and refunding customers, replacing the previous recall and exchange programme which was implemented on October 1 in Vietnam.

Accordingly, each customer will receive a refund of VND18.99 million ($846). Additionally, customers who bring their products to Samsung customer centres are entitled to a VND1.5 million ($67) voucher and another Samsung smartphone to use while they wait for their refund.

The recall and refund programme will last until November 18, 2016. Samsung expects to spend VND240 billion ($10.6 million) on the programme only in Vietnam.

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