Samsung has seen $7bn wiped off its market value after reports of batteries exploding in its popular Galaxy Note 7 smartphones. The tech giant’s stock dipped to a two-week low after it announced it had delayed shipments for quality control testing. It has also halted supplies to the top three mobile carriers in its native South Korea. Analysts said the news was a major blow to the company, which faces a fresh battle with Apple when it launches new iPhones next week.
This is some major buzz-kill for Samsung, especially given all of the hard-earned excitement that products like the Note 7 have been garnering lately.
IDC analyst Bryan Ma
Samsung’s troubles began when users posted images and videos of charred Galaxy Note 7s online and said their phones had caught on fire. “Be careful out there, everyone rocking the new Note 7, might catch fire y'all,” one user said in a YouTube clip showing a burnt Note phone. Samsung is reported to be planning to recall affected Note 7 phones and replace their batteries as opposed to giving the users a new device. “The pending Apple launch puts all the more pressure for them to contain this quickly. The timing of this couldn’t have been worse,” said industry analyst Bryan Ma.
Apple is supposed to show off the iPhone 7 next week and this issue has emerged, so the current state of things do not look good
HDC Asset Management fund manager Park Jung-hoon