Samsung has warned that profits during the third quarter of 2016 will be a third lower than expected, with the Galaxy Note 7 controversy to blame.
Only last week Samsung claimed that its profits during the June to September period would be unaffected by problems with the Galaxy Note 7. At the time it was still planning on relaunching the smartphone and was in the process of replacing faulty devices.
Now though, the Galaxy Note 7 has been discontinued following a raft of issues with new models. Samsung says it still expects to make £3.8 billion, but that’s down a third from its previous estimate.
The company’s share price has plunged by almost 9% this week. This has been compound by Apple share prices soaring in the wake of the Samsung farrago.
Although Samsung has new devices lined up for launch in early 2017, it’s likely that problems with the Galaxy Note 7 could severely damage its brand in the long term. With Google’s new Pixel phones, plus Apple’s forthcoming tenth anniversary iPhones, the timing could not have been worse.
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