Samsung Reports Highest Profits in Three Years, Despite Note 7 Disaster
Samsung Electronics has estimated its operating profit surged by almost 50 percent in the final quarter of 2016, according to a new report from Reuters. Analysts called it an astonishing achievement, given the company’s trouble with the exploding Galaxy Note 7 fiasco.
Samsung Electronics Co. has gone through hardly four months after it issued a massive recall of its flagship Galaxy model, but now the company has predicted the strongest operating profit for 2016 Q4 – an amazing transformation from a massive recall to the company’s greatest profits in three years.
According to Samsung, it’s looking forward to a 9.2 trillion Korean won (around $7.2 billion USD) consolidated operating profit for the fourth quarter of 2016, which is nearly twice the 6.14 trillion Korean won (around $5.2 billion USD) profit it got in the same quarter in 2015. It’s likely that the revenue will stay more or less the same at 53 trillion Korean won.
It looks like the expensive Note 7 recall was just a temporary hiccup in the financial situation of the company rather than a lasting impact on consumer confidence. However, this is not to say that the recall failed to have an impact, but it seems its main financial consequences on the wider firm may have been restricted to just the year’s third quarter.
It benefited from improved sales of memory chips and organic light-emitting diode (OLED) screens for smartphones, which it supplies to rivals, making up for the Note 7 fiasco which cost it the equivalent of almost two billion euros.
The world’s biggest maker of smartphones, TVs, and memory chips will not disclose detailed earnings, including the performance of its individual businesses, until late January. Samsung’s shares continue to rise, and last year they were up 43 percent.