Korean electronics giant expects slight rise in operating profit for third quarter, but that doesn’t appear to include recall costs
Samsung’s exploding Galaxy Note 7 doesn’t appear to have hurt the company’s earnings too much in the third quarter.
The Korean electronics giant said Thursday that it expects its operating profit during the period to come in at 7.7 trillion won ($6.9 billion), a modest increase of about 5 percent compared with the same period last year. The guidance is in line with the 7.4 trillion won expected by a Thomson Reuters StarMine SmartEstimate of analysts’ forecasts.
The company is also expected to record revenue of nearly 51 trillion won ($45 billion). The guidance, released today ahead of full earnings later this month, did not provide specific divisional results.
The company has been grappling with massive a public relations mess since last month, when Samsung recalled Galaxy Note 7 devices worldwide after a battery flaw caused dozens of the phones to explode or burst into flames. As of September 22, Samsung said half of the 1 million defective devices sold in the US had been returned.
Though some analysts expect the recall of its Galaxy Note 7 to cost Samsung $5 billion in lost sales and other expenses, strong sales of memory chips and displays is expected to offset some of that pain.