Samsung flags profit jump despite Note 7 recall

Seoul : Samsung Electronics yesterday flagged a 5.5- per cent rise in operating profits, even as it struggles with a damaging global smartphone recall and a shareholder push to split the family-run conglomerate in two.

In an earnings forecast that beat analyst estimates, Samsung said its operating profit for the July-September period would stand at around 7.8 trillion won ($7.0 billion), compared to 7.39trn won a year ago. The estimate was down on the 8.1trn won profit posted in the second quarter. Just weeks after the early roll-out of the Galaxy Note 7 “phablet”, Samsung was forced in early September to recall 2.5 million units globally following complaints its battery exploded while charging.

The Note 7 was meant to underpin growth this year as Samsung struggles to boost sales.

Analysts have estimated the cost of the recall at $1.0 billion to $2.0bn.