Samsung will replace more than 2.5 million Galaxy Note7 devices
With at least 35 cases of Samsung's new Galaxy Note7 catching fire while charging, Samsung has halted further shipments of its devices.
The South Korean company will replace the phones that have already been sold, were at retailers and were in transit, Samsung said Friday. Future shipments are delayed.
SEE ALSO:Samsung makes critical decision on Galaxy Note 7 due to reports of explosionsHow much will the ordeal cost the conglomerate?
It's difficult to peg given the global scale, and the greater cost may come from damage to its reputation. Indeed, while other companies, like Apple, have issued their own recalls, Samsung has not faced such burdens, especially one that is so life-threatening.
Samsung declined to comment on the price tag for replacing the phones but admitted that it is not something to brush off. About 2.5 million had already been sold. Counterpoint Research estimates about 3 million had been shipped.
"It is a big amount that is heartbreaking," Koh Dong-jin, president of Samsung's mobile communications business, said at a news conference, according to CNNMoney.
Samsung lost about $7 billion of its market valuation after the company announced the delay in shipments on Thursday.
Such an ordeal is huge for Samsung given that its mobile division accounts for more than half of its profits. From January to June, Samsung's operating profit was $14.4 billion, where mobile accounted for 54 percent.
The recall and delay could cost up to $1.34 billion from its 2016 operating profits, Credit Suisse estimates, according to Reuters. Credit Suisse pegged Samsung's total operating profits for the year at $27.96 billion. In that scenario, the event would shave upwards of 5 percent off the total profit.
But that number is in its "absolute worst case" scenario. In replacing the phones, Samsung will gain back parts of the phone that could be recycled into new devices. While the exact cause of the explosion has not been determined, it may just be faulty batteries.
Time may be on Samsung's side. The incident happened only two weeks after the release.
"Since this has happened quite early in the product launch cycle instead of post-holiday season, it won’t cause a huge dent for Samsung financially," Jeff Fieldhack, research director at Counterpoint Research, wrote to Mashablein an email.
A full replacement of all shipped and in-store devices is immediately costly, but it could help to ease consumer's panicked minds. Replacing models "helps enhance consumer confidence and help reduce potential falls in future sales," HI Securities analyst James Song told Reuters.
Shares rose by more than 0.6 percent in trading Friday.
TopicsSamsung
(责任编辑:新闻中心)
- Elon Musk's AI facility is reportedly operating gas turbines without a permit
- Someone put a bra on a cow for a very wholesome reason
- South Koreans divided over Kim Jong
- South Koreans divided over Kim Jong
- Number of COVID
- Tesla's big software update includes something called 'Night Curfew'
- World's top Go player to challenge AI programs at Chinese competition
- South Koreans divided over Kim Jong
- 加强住房公积金归集管理
- Apple to start manufacturing iPhone Pro in India, report claims
- Illegal subway rides rise in Seoul
- Barca in need of rare European home victory
- 10 delightful fascinators you should wear while watching the Royal Wedding
-
市民填写献血相关表格8月22日晚,雨城区正黄时代天街广场天桥旁停靠着一辆献血车,身穿红马甲的志愿者们正向路过的市民发放无偿献血宣传手册,不少市民停下脚步,参与无偿献血。这是雅安市中心血站开启夜间献血模 ...[详细]
-
North Korea slams UN rapporteur over human rights comment
U.N. Special Rapporteur of human rights Tomas Ojea Quintana during a press conference at the Korea P ...[详细] -
U.S. House resolution calls for stronger 3
A U.S. House lawmaker has introduced a resolution calling for stronger trilateral cooperation betwee ...[详细] -
North Korea slams UN rapporteur over human rights comment
U.N. Special Rapporteur of human rights Tomas Ojea Quintana during a press conference at the Korea P ...[详细] -
Spate of defections show Kim Jong
A new monument that commemorates North Korean defectors who have died while escaping from the repres ...[详细] -
南农晨读丨歌王诞生_南方+_南方plus【今日关注】广东乡村歌王诞生!大永宁组合斩获双料冠军 | 2023广东乡村歌手大赛乡村田野放声唱,壮阔山河曲中赏。12月30日晚,广东乡村歌手大赛总决赛在广州翼 ...[详细]
-
LIV Invitational will attract top players: Norman
LONDON:Many of the world's top golfers have distanced themselves from the Saudi-backed LIV Golf ...[详细] -
Jimmy Fallon loves 'Gilmore Girls' and names his top four characters
Jimmy Fallon, you adorable goofball. Like so many new viewers, the Tonight Showhost has been spendin ...[详细] -
Best smart home deal: The Amazon Smart Thermostat is just $63.99
SAVE 20%: The Amazon Smart Thermostat is on sale for $63.99 at Amazon, down from the normal price of ...[详细] -
Ariana Grande and Pete Davidson are uh, casually dating, I guess
Live from the latest sorta confusing but kinda cute celebrity relationship stage, it's Ariana Grande ...[详细]
Best Labor Day mattress deals in 2024
Facebook fake news update abandons disputed flags for related articles
- Tesla issues recall for 9,100 Model X cars
- Top officials of US, Canada discuss North Korean sanctions evasion
- The hashtag campaign saying 'Hear Me Out' about Ireland's abortion laws
- OnePlus may take on Apple and Samsung with new flagship model in March
- 雅安公安接连破获两起汉源湖非法捕捞案
- 老艺术工作者喜迎国庆
- All the celebrities at the star