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The Galaxy Note 7 Recall to cost $1 billion, wont affect Samsung Brand



Samsung Galaxy Note 7 recall is the biggest news on the internet today. The decision was made by the company to make sure that the consumers are safe, and the device poses no harm to the users. However, this might not have been the easiest decision for them. We are talking about millions of Note 7 units across the globe and apparently they shed about a billion dollars on the same.

According to reports, this recall would cost have cost $1 billion in total. The overall effect of this recall is expected to be about 5 percent of the total annual net income which is projected to be about $20.6 billion for the year 2016. Most of this would be majorly picked up by Samsung SDI, which supplied 70 percent of the defective battery. It is also reported that 1 of 24 units come with this defective battery. These defected units pose a threat of catching fire and exploding while charging.

Even though the recall has ruined the advantage for Note 7 over the upcoming iPhone release, it is reported that it is not going to affect the company in terms of brand value. Samsung’s early marketing initiative, good reviews of the smartphone, etc. saves them here. The Note 7’s early sales have majorly reinforced the absence of the new iPhones in the market. But as of now, the sales of the Note 7 phablets is halted in ten countries.

Analysts predict that the company is going to take a hit on sales numbers this quarter but it is not going to have any major impact on the overall annual sales figures. One side, consumers are appreciating the company’s efforts for initiating this recall and on the other, many are raising a voice against this as this issue arised on the first place. There are mixed opinions on this issue as of now, so let’s see how things goes for the company in future. Stay tuned for more info.


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