Samsung’s facilities suffer massive losses in third quarter
Samsung’s facilities suffer massive losses in third quarter
Samsung’s mobile manufacturing and trading facilities suffered massive losses after revenue took a plunge in the third quarter of this year due to the break-down of faulty Samsung Galaxy Note 7 units, according to newswire Cafef.
Notably, according to its financial report, Samsung Electronics Vietnam (SEV), one of the facilities producing the faulty Samsung Galaxy Note 7, reported a loss of VND3 trillion ($131.98 million) and a 30 per cent, VND32 trillion ($1.41 billion), reduction in revenue compared to the second quarter. However, according to the accumulated statistics, SEV earned VND25 trillion ($1.09 billion) in net profit in the three quarters of this year.
Samsung’s another mobile manufacturing facility, Samsung Huizhou in China, and its US mobile trading arm Samsung Electronics America reported losses of $307.59 million and $114.9 million, respectively.
Earlier in October, Samsung Electronics officially announced a loss of approximately $3.1 billion in profits in the next two quarters, after suspending the sales of Galaxy Note 7 units.
Notably, the loss in profit was estimated to reach $2.2 billion in the fourth quarter of 2016 and $890,000 in the first quarter of 2017.
Previously, after deciding to suspend the sales of Note 7 units, Samsung also decided to adjust its revenue and profit targets for the third quarter of 2016. Accordingly, the revenue target will decrease by $2 billion, to $42 billion, and the profit target will decrease by almost two thirds, to $4.7 billion.
On September 2, the company suspended the sales of overd products and recalled 2.5 million Note 7 devices that had been shipped worldwide after faulty batteries started sporadically exploding while charging.
According to Samsung’s replacement policy, total end-users will receive new devices kitted out with new IMEIs (International Mobile Equipment Identities) and serial numbers.
