Last year, Samsung lost over $10 billion due to the recall of the Samsung Galaxy Note 7 which were combustible due to faulty batteries. At the time, the South Korean electronics giant had hoped the Galaxy note 7 would help them compete with Apple’s iPhone 7.
The fact that the phones were bursting into flames, not only forced Samsung to recall the unit, they also discontinued it.
After the recall, many industry analysts figured it would take some time for Samsung to recoup its loss and recover from the debacle. Less than a year later, Samsung is sitting pretty and has made up the losses from the Galaxy Note 7 recall.
Samsung was able to recover quickly thanks to the sales numbers of the Samsung Galaxy 8. In June, the smartphone exceeded $1 million in domestic sales, and did it twice as quickly as its predecessors. Samsung had been hoping the device, which was released in April, would help them recover some of the money they lost on the Galaxy 7 Note.
The Galaxy 8 more than exceeded expectations and became a high demand item in Korea and around the world.
Kim Young-woo, an analyst at SK Securities, said Samsung must be glad the Galaxy 8 hasn’t caused the same type of trouble the Galaxy 7 note did. He added that consumers haven’t had any worries about the quality of the smartphone.
Despite the success Samsung has had with the Galaxy 8 smartphones, they aren’t selling as well abroad as they are in South Korea, according to Mr. Kim. He added that while the overseas numbers aren’t as impressive as the domestic numbers, they are on par with previous versions of the Samsung Galaxy smartphones. Although, Kim said the fact that some consumers are waiting on the new iPhone probably affected the overseas sales as well.
The Samsung Galaxy 8 was expected to outsell the Galaxy 7, which sold over 48 million units in its first year. However, the Galaxy 8 is now projected to sell 45 million units this year.
While Samsung remains the world’s largest mobile phone manufacturer, its market share slipped from 23.3 percent last first quarter to 20.7 percent in this year’s first quarter. The drop in market share made Samsung the only top-5 phone company to decline in shipments.
Despite the setback caused by the Galaxy Note 7, Samsung posted its best quarterly operating profits in three years in the first three months of 2017, and analysts expect the company to report even more operating profit in 2017.
Since the start of the year, Samsung’s market share has risen to 30 percent.