Even flaming Galaxy Note 7 can’t scorch Samsung profits
Samsung’s booming chip and display business was enough to offset the cost of having to recall its Galaxy Note 7 smartphones, according to a Q3 regulatory filing the South Korean tech company made today.
The company’s 7.8 trillion won ($7 billion) profit grew 5.6 percent by quarter to beat expectations. However, things might be a bit more complex than they initially appear.
As Reuters notes, Samsung discloses only overall estimates in its filing, and won’t have to release full results until late October. In the filing, there’s no comment about how much a Galaxy Note 7 recall will cost. Some brokerages have suggested it could cut into Samsung’s mobile profits by 1 trillion won or more.
While it obviously wouldn’t impact on July-September earnings, there has also been mounting speculation that Samsung may be looking at a recall for its replacement Note 7 handsets, after they exhibited the same problems as the ill-fated first generation handsets.
This week, a Southwest Airlines plane was evacuated when a Galaxy Note 7 began spewing grey-green smoke after its owner dropped it on the floor. It then proceeded to burn through the plane’s carpet.
While it’s certainly good to outperform earnings expectations, however, not everything about the filing is quite so rosy: revenue compared to this time last year declined by 5 percent.