Samsung profits beat estimates despite Note 7 global recall

Tech giantSamsung Electronics on October 7 released its third-quarter earnings guidance that beat analyst estimates following a large-scale recall of its latest Galaxy Note 7 smartphone.

The South Korean firm, which is due to release the full results later this month, is expected to confirm then that earnings from its component businesses, including memory chips and displays, offset the growing phone bill.

Samsung Electronics saw its operating profit rise in the third quarter despite a global recall of Galaxy Note 7 smartphones, the company said on Friday.

The estimate was down on the 8.1 trillion won profit posted in the second quarter. Last month Samsung recalled 2.5 million units of the Galaxy Note 7 just two weeks after its debut as consumers reported that batteries were overheating and catching fire.

That was followed by global airlines banning the phone during flights and official recalls by the governments in the US and Canada. Some brokerages said the recall would cut Samsung's mobile profits by 1 trillion won or more.

Samsung provides its own earnings estimates each quarter for investors.

The company didn't offer breakdown profits in each business division.

The Note 7 was meant to underpin growth this year as Samsung struggles to boost sales, squeezed by Apple in the high-end sector and Chinese rivals in the low-end market, as profit has stagnated, AFP says.

Samsung is the world's largest maker of the computer memory chips and the world's dominant supplier of advanced mobile-phone screens known as OLED. Sales are also seen to decrease 3.8 percent from the previous quarter's sales of 50.94 trillion won.

The latest blow to Samsung's brand happened earlier this week when a USA domestic plane with 75 passengers had to be evacuated because of a Samsung phone emitting smoke before the plane's takeoff.

Yesterday, however, a replacement version of the Galaxy Note 7 that had been deemed safe by Samsung reportedly caught fire on board a Southwest Airlines airplane sitting at the gate at Louisville International Airport.



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