Samsung halts production of Note 7 over safety concerns
The profit slump was in line with a revised earning estimate issued by Samsung two weeks earlier after it killed off its flagship Galaxy Note 7 smartphone due to devices overheating and bursting into flames. Photograph: (Getty)
Samsung on Tuesday announced a total halt to production of its troubled Galaxy Note 7 smartphone, citing continued safety concerns over the device exploding.
"We recently readjusted the production volume for a thorough investigation and quality control, but putting consumer safety as top priority, we have reached a final decision to halt production of Galaxy Note 7s," the company said in a statement.
The world’s largest seller of smartphones told its customers to stop using their Galaxy Note 7 smartphones while it investigates reports of fires in the devices.
"Consumers with either an original Galaxy Note 7 or replacement Galaxy Note 7 device should power down and stop using the device," the company said.
The company, which was banking on its flagship Note 7 to take on competitors like Apple’s iPhone 7, hit rock bottom when reports of battery explosion began surfacing.
Samsung then initiated a global recall of at least 2.5 million devices in 10 countries in September. But with even the replacement devices reportedly catching fire Samsung might be heading towards a global scandal.
Top US and Australian carriers had suspended sales or exchange of Note 7s, after there were reports of even the replacement devices exploding.
Samsung’s decision to pull Note 7s off the shelves for the second time in two months underscores the South Korean firm’s struggles to fix the over-heating issue.
The premium device was launched in August but within weeks of the launch images of charred Note 7s began appearing on social media.
Edward Snyder, managing director of Charter Equity Research, told Reuters it was important to get the Note 7 off the market.
"This has probably killed the Note 7 brand name, who knows if they’ll even be allowed to re-release it," Snyder said.
"By the time they fix the problem they have to go through re-certification and re-qualification and by the time that happens they’re going up against the (Galaxy) S8 launch.”
The US Consumer Product Safety Commission said Samsung was making the right decision by halting sales and exchanges of the device.
"No one should have to be concerned their phone will endanger them, their family or their property," CPSC Chairman Elliott Kaye said in a statement.
"While we continue our active investigation into reports of phones overheating and burning in multiple states, consumers should power down and stop using all Galaxy Note 7s. This is the safest course of action.”
(WION with inputs from Reuters)