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October 28, 2016

Samsung's mobile profits plummet after smartphone recall

Samsung Galaxy Note 7
Image Caption: Samsung hoped the handset would be a strong rival for the Apple iPhone

Scrapping the device - after two recalls - caused the division's operating profit to drop almost 98%, to 100 billion South Korean won (£71.4m), between July and September.   

The company as a whole saw its net profits fall 17% to 4.4 trillion South Korean won (£3.1bn), down from 5.3 trillion won (£3.7bn) for the same period a year earlier. 

JK Shin, Samsung co-CEO and former head of its mobile unit told shareholders in Seoul: "We are investigating every aspect of the device including battery, hardware and software with the probe open to all possibilities.

"We are trying to completely figure out if there was any error on other parts ... it could be a battery, or it could be something else."   

Samsung Galaxy Note 7
Video: Samsung admits defeat by permanently discontinuing Galaxy Note 7

The South Korean electronics company first recalled the devices in early September after they were found to overheat or reportedly catch fire.     

The company had to recall the handset again earlier this month before finally discontinuing it when owners of replacement phones also reported faults.              

Samsung had blamed problems which led to the first recall on batteries provided by a particular supplier, and assured customers it was using a different supplier for its replacement phones. 

The large-screen device was on the market for less than two months.  

SAMSUNG GALAXY NOTE 7
Image Caption: The recall has badly damaged Samsung's reputation

 :: Timeline of Samsung Galaxy Note 7 fire crisis

Mr Shin, 60, has promised "complete reform", saying: "We are trying to overhaul all of our process including quality control so that our new handset to be released next year will not have a problem like this.   

"We know we must work hard to earn back your trust and we are committed to doing just that."  

SAMSUNG GALAXY NOTE 7
Image Caption: The recall has badly damaged Samsung's reputation

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