Samsung warns of $4.3 billion hit to profit from Galaxy Note 7 debacle

Samsung warns of $4.3 billion hit to profit from Galaxy Note 7 debacle

Samsung Electronics said it expected to take a hit of about 3.5 trillion won (S$4.3 billion) to its operating profit over the next two quarters from the fallout of its bungled Galaxy Note 7 recall.

The South Korean tech giant said it expected the negative impact to be in the mid-2 trillion won range in the October-December quarter and about 1 trillion won for the January-March 2017 quarter as a result of discontinued sales of its Note 7 handsets.

On Wednesday, Samsung cut its operating profit guidance for the third quarter by 33 per cent, from 7.8 trillion won to 5.2 trillion won.

Third-quarter revenue was also revised down from 49 trillion won to 47 trillion won.

Samsung also said on Friday that it planned to expand sales of flagship smartphone models such as the Galaxy S7 and S7 edge.

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