Samsung is the number one smartphone manufacturer in the world, and has been for a while now. The company has been doing a great job with their smartphones lately, well, until they released the Galaxy Note 7. It seemed like the Galaxy Note 7 will be a smashing success, just like the Galaxy S7 and Galaxy S7 Edge, but even though the initial impressions were great, and a ton of people pre-ordered the device, something completely unexpected happened, certain Galaxy Note 7 units started exploding. A number of Galaxy Note 7 units were shipped out with malfunctioning batteries which tend to explode when the phone is charging, and the company was forced to recall the Galaxy Note 7. Now, this global recall is definitely hurting Samsung financially, quite a bit actually, but the company's Q3 2016 earnings are still quite strong it seems, despite the Galaxy Note 7 fiasco, read on.
Samsung has just released their earnings guidance for the third quarter of this year. The company has announced today that they expect to post consolidated sales of 49 trillion won, and an operating profit of 7.8 trillion won ($7 billion). Now, despite all the Galaxy Note 7 issues that the company had faced in the last couple of weeks, their earnings seem to be unaffected, how's that possible? Well, according to analysts, the Samsung's other businesses definitely helped soften the blow, the company's chip and display businesses are definitely doing great, better than expected, and the company's high profit margins are the result of that. Now, all in all, it seems like Samsung's operating profit in Q3 managed to grow 5.6% (Year-on-Year), which certainly is a surprise. In any case, the company will release full results later this month, and then we'll be able to check out all the necessary details, as per usual.
The company is still struggling with the Galaxy Note 7 problems even though they've already replaced a ton of malfunctioning units, so it is possible that the company's Q4 2016 results will be affected by the Galaxy Note 7 as well, but we'll have to wait and see what happens, these are certainly odd times for this Korea-based tech giant, that's for sure.