Samsung Halts All Sales of Galaxy Note 7 Smartphones

Samsung has confirmed that they are halting all sales and exchanges of the Galaxy Note 7 across the globe.

Not only that, but they are recommending that owners of the phone turn them off and “take advantage of the remedies available.”

Those remedies are returning the phone at the place of purchase for a refund or swapping the phone out for something else.

That’s it. Samsung wants you to get rid of your Note 7 right now. Please do it.

At this time, Samsung is still investigating recent reports of exploding “safe” devices, but because “consumers’ safety remains our top priority,” they want you to get rid of the Note 7 you may have purchased.

The full statement is as follows:

We are working with the U.S. Consumer Product Safety Commission (CPSC) to investigate the recently reported cases involving the Galaxy Note7. Because consumers’ safety remains our top priority, Samsung will ask all carrier and retail partners globally to stop sales and exchanges of the Galaxy Note7 while the investigation is taking place.

We remain committed to working diligently with the CPSC, carriers and our retail partners to take all necessary steps to resolve the situation. Consumers with an original Galaxy Note7 or replacement Galaxy Note7 should power down and take advantage of the remedies available, including a refund at their place of purchase. For more information, consumers should visit samsung.com/us/note7recall or contact 1-844-365-6197.

The Size and Scope of Samsung's Business
At first glance, things couldn’t be much worse for Samsung Electronics, the worldwide smartphone market leader: Ever since the first reports of exploding Galaxy Note 7 phones surfaced in August, the bad news just keep rolling in.

Not only was the company forced to recall millions of Note 7 smartphones around the world, it also has to endure the PR nightmare of flight passengers around the world being advised not to turn on their Note 7 devices while on board.

To make things worse, there are now several reports of phones catching fire AFTER being replaced, which prompted Samsung to halt production of the Galaxy Note 7 and might well lead to a second (possibly total) recall.

So surely Samsung’s shareholders must be jumping ship in droves, right? Well, not quite.

Not only is Samsung’s share price up by almost 10 percent since Samsung unveiled the Galaxy Note 7 in early August, it even hit an all-time high on Friday after the company provided strong guidance for its third quarter earnings.

So how is that possible? First of all, the recall affects just a tiny portion of Samsung’s huge smartphone business.

Net Revenue of Samsung Electronics by Operating Segment

Secondly and more importantly, Samsung Electronics is a world-leading company in more than just smartphones: as our chart illustrates above, the company generates tens of billions of dollars in revenue, selling everything from semiconductors to display panels, refrigerators and basically every other piece of electronic equipment you can think of.

So even if the worst case scenario, a second recall that would probably be the death blow for the Galaxy Note 7, comes true, the diversity of Samsung’s activities will help cushion the blow.

Sources: Droid Life and Statista

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