14 DAY TRIAL // Damage control must be the words on the minds of everyone working at Samsung, as the company recently announced that it permanently stopped production and sales of its latest flagship, the Galaxy Note 7. Samsung will most likely try to boost sales of some of its other smartphones.
The Korea Herald reported that Samsung is now increasing production of the Galaxy S7 and lower-end smartphone models. “Samsung is planning to put more focus on the Galaxy S7 by ramping up production of the handset,” said an unnamed source for Korea Herald.
The report mentions that the production increase is meant to reduce the anticipated profit loss for the rest of the year following the suspension of Note 7 sales. Samsung is said to have contacted suppliers and asked them to increase production for the Galaxy S7 so that it can recover some of the missed sales for the Note 7. In addition, the South Korean company offers Note 7 owners the option to exchange the phone for a Galaxy S7 or S7 edge.
It seems that suppliers will be focusing on providing parts for other smartphones, including the Galaxy A8. The report also mentions that Samsung is focusing on the manufacturing of its next flagship, the Galaxy S8, set to arrive in February or March next year.
Samsung’s components suppliers are also affected by the production halt
Some have said that Samsung might advance the launch date for the Galaxy S8, and an official from one of Samsung’s partnering companies stated that “the rescheduling would be possible only if Samsung ceases production of the Note 7 for good and takes no further measures to salvage the handset.”
The South Korean phone maker won’t be the only one affected by the permanent production halt for the Galaxy Note 7. An IR official from a camera lens supplier for Samsung stated that “a decrease in profit margin in the fourth quarter due to the sales suspension is inevitable.”
The Galaxy Note 7 situation is expected to cause a $17 billion loss for Samsung, as the company recorded an 8% drop in shares, one of the biggest declines in one day.