Samsung's ongoing nightmare concerning it's flagship Galaxy Note 7 is going to burn a really big hole in the Korean phonemaker's pocket. Samsung announced that the discontinuation of the phone will cost the company $3 billion over the course of the next two fiscal quarters. The phone which has a knack for overheating and exploding while being charged has gotten Samsung into all kinds of problems. After the first batch of phones sold in the United States and South Korea started to explode and injured quite a lot of people around the world, Samsung issued an official recall for millions of devices sold. Earlier it was thought the battery was at fault. But when even the replacement units of the Galaxy Note 7s started to catch fire in multiple cases reported around the world, Samsung issued a total recall of all devices (with incentive of getting $100 for every Note 7 returned)
And even after all this, Samsung still can't figure out what exactly is causing the phones to catch fire and explode.
And now that it has permanently discontinued the production, Samsung says in a statement, "The company already allocated the expected direct cost from the discontinuation of Galaxy Note 7 sales in its third quarter earnings guidance revision announced on October 11th, but expects the drop in revenue from the discontinued sales to continue to have a negative impact on operating profit for the next two quarters. The negative impact is estimated in the mid-2 trillion won range for the fourth quarter of 2016 and at approximately 1 trillion won for the first quarter of 2017."
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