Samsung's chip & display businesses rescue profits in wake of exploding Note 7 recall

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in General Discussion
Samsung Electronics' estimated operating profits grew 5.6 percent in the third quarter in spite of its massive Galaxy Note 7 recall, buoyed by increased chip and display sales.









Operating profits are thought to have been approximately $7 billion, up year-over-year from around $6.7 billion, Reuters reported, even though revenues were down 5.2 percent to about $44 billion. More precise numbers are only due in late October.



Samsung didn't say what sort of impact the Note 7 recall had, but outside analysts have speculated that the damage could be $897 million or more. The company ordered about 2.5 million units recalled, and it's not yet clear that the fixed phones are much safer.



The incident may have ironically helped the company's chip division, as the sudden need for chips in replacement phones may have put a crush on an already stretched memory market, pushing up prices. Smartphone makers -- including ones trying to seize on Samsung's mistakes -- may be scrambling to claim what's left of a limited supply. Research firm TrendForce is predicting that DRAM chip prices will jump by more than 10 percent in the December quarter.



Also helping Samsung may be the Galaxy S7 and S7 Edge, the company's well-reviewed flagship phones, which have been out for some time but have enjoyed healthy sales.

Comments

  • Reply 1 of 18
    NY1822NY1822 Posts: 621member
    the new pyramid scheme...destroy one segment of your business to boost another...

    Best Buy is now offereing a free 32" tv and Gear VR Headset with purchase of Galaxy 7
    edited October 2016 igorskycaliSpamSandwich
  • Reply 2 of 18
    The key piece of info in this report? "Samsung didn't say what sort of impact the Note 7 recall had."

    Hmm. It's like the dog that didn't bark. 

    Says all all you need to know about whether you should buy this stock. 
    calibadmonkSpamSandwichlolliver
  • Reply 3 of 18
    lkrupplkrupp Posts: 10,170member
    macxpress said:
    SamsungInsider...
    In my neck of the woods you see people using either iPhones or Samsung phones and little else. So that makes Samsung news kinds interesting to read in my opinion.
    blastdoorkudubadmonkperkedelboredumbwatto_cobralolliverjony0
  • Reply 4 of 18
    blastdoorblastdoor Posts: 2,834member
    If that story about the replacement Note catching fire turns out to be more than just a fluke occurrence then the long term damage to Samsung's brand (and therefore pricing power and market share) will dwarf the short term replacement costs. 

    On the other hand, if the replacement process goes smoothly and if they can avoid any other big quality issues for the next year, then they can probably recover. I think consumers are understanding up to a point. 
  • Reply 5 of 18
    Wait until next quarter.  Will be horrific.  Besides the Samsung fanatics, the "regular" folks are steering clear of the Note.  I personally know three people who bought Notes and are returning them permanently and getting another phone from a different company.  I don't know what their replacement phones will be, but still, not good.
    calibadmonk
  • Reply 6 of 18
    2 things.

    1. The effect may not yet be fully realized, long term damage may be worse than short term costs.
    2. Another great reason for Apple to get out of using Samsung as a supplier. Samsung rescued by iphone (in part)
    igorskycaliperkedellolliver
  • Reply 7 of 18
    macxpressmacxpress Posts: 5,418member
    lkrupp said:
    macxpress said:
    SamsungInsider...
    In my neck of the woods you see people using either iPhones or Samsung phones and little else. So that makes Samsung news kinds interesting to read in my opinion.
    Not on an Apple centric site it doesn't. A site like ArsTechnica yes, because its not specific to one brand. APPLEInsider, no. Has nothing to do with Apple specifically.

    Didn't AppleInsider used to have something call like AppleInside Backpage? This would be a perfect place for things like this. 
    edited October 2016 cali
  • Reply 8 of 18
    adrayvenadrayven Posts: 460member
    Maybe Samsung Mobile should take Note of the issue.
    anton zuykov
  • Reply 9 of 18
    jdgazjdgaz Posts: 393member
    There is no way I would put one of those phones in my home or office. Risk is just way too high.
    calilolliver
  • Reply 10 of 18
    seankillseankill Posts: 559member
    macxpress said:
    lkrupp said:
    macxpress said:
    SamsungInsider...
    In my neck of the woods you see people using either iPhones or Samsung phones and little else. So that makes Samsung news kinds interesting to read in my opinion.
    Not on an Apple centric site it doesn't. A site like ArsTechnica yes, because its not specific to one brand. APPLEInsider, no. Has nothing to do with Apple specifically.

    Didn't AppleInsider used to have something call like AppleInside Backpage? This would be a perfect place for things like this. 
    Understanding Apple's competition and their conditions is important to understanding Apple. It is a common market....get used to it. Same goes for Android websites. Those that I read, have similar articles discussing Apple.
    perkedelboredumbwatto_cobralolliver
  • Reply 11 of 18
    calicali Posts: 3,494member
    sog35 said:
    You know what's ridiculous?

    I know someone who bought a Note7 at launch.
    He then returned it and waited a month for the 'safe' version.
    He got it but now he wants to return it again because he can't use it in planes.

    Guess what? He can't return it. Part of the replacement program is you CAN'T RETURN the replacement. WTF.

    This is why I'm willing to stick with Apple. The competitions customer service is AWFUL.
    What's worse is the replacement units aren't any safer. Oh and what's even worse is that Samsung doesn't give a damn.
    watto_cobralolliver
  • Reply 12 of 18
    robin huberrobin huber Posts: 3,691member
    Mobile computing is Apple's soul; for Samsung it's just another line. Samsung can afford to fail, Apple cannot. You see the result. 
    cali
  • Reply 13 of 18
    irelandireland Posts: 17,793member
    sog35 said:
    You know what's ridiculous?

    I know someone who bought a Note7 at launch.
    He then returned it and waited a month for the 'safe' version.
    He got it but now he wants to return it again because he can't use it in planes.

    Guess what? He can't return it. Part of the replacement program is you CAN'T RETURN the replacement. WTF.

    This is why I'm willing to stick with Apple. The competitions customer service is AWFUL.
    Perfect recipe to put people off the brand.
    calilolliver
  • Reply 14 of 18
    dbeatsdbeats Posts: 26member
    Samsung is making more money selling iPhone components then their own phones, lol. 
    anantksundaramcaliwatto_cobralolliver
  • Reply 15 of 18
    jungmarkjungmark Posts: 6,924member
    NY1822 said:
    the new pyramid scheme...destroy one segment of your business to boost another...

    Best Buy is now offereing a free 32" tv and Gear VR Headset with purchase of Galaxy 7
    Pretty sure it's one or the other. Otherwise, great deal.
    Until you realize you have to buy a Sammy phone. 
    anton zuykovwatto_cobra
  • Reply 16 of 18
    boredumbboredumb Posts: 1,418member
    NY1822 said:
    the new pyramid scheme...destroy one segment of your business to boost another...

    Best Buy is now offereing a free 32" tv and Gear VR Headset with purchase of Galaxy 7
    Pretty sure it's one or the other. Otherwise, great deal.
    It's both.
  • Reply 17 of 18
    freerangefreerange Posts: 1,595member
    macxpress said:
    lkrupp said:
    macxpress said:
    SamsungInsider...
    In my neck of the woods you see people using either iPhones or Samsung phones and little else. So that makes Samsung news kinds interesting to read in my opinion.
    Not on an Apple centric site it doesn't. A site like ArsTechnica yes, because its not specific to one brand. APPLEInsider, no. Has nothing to do with Apple specifically.

    Didn't AppleInsider used to have something call like AppleInside Backpage? This would be a perfect place for things like this. 
    Beep! Wrong answer macxpress! You lose a turn. This has everything to do with Apple - Samsung is a major  component supplier to Apple, if not still the largest, and therefore quality issues are of concern. Secondly, Samsung is Apple's largest iPhone competitor and is therefore of major interest to those of us that follow Apple's business, not just their products.
    anton zuykovwatto_cobralolliver
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