Samsung Third-Quarter Profit Drops 17%

Samsung reported a 17 percent slump in third-quarter profit after the demise of its fire-prone Note 7 line threw the world’s largest smartphone maker into disarray, according to Bloomberg. Net income fell to 4.41 trillion won ($3.9 billion) in the September quarter as the company dealt with a debacle that may ultimately cost more than $6 billion.

While the crisis has cast a pall over the smartphone division, the display and chip businesses -- which supply screens and memory to TV makers and rival phone brands -- have held up well. Its shares have gone on a roller-coaster ride since the Note 7 recall began in September, at one point shedding more than $20 billion of market value.

The company says capital expenditure this year will be 27 trillion won Third-quarter net income of 4.41 trillion won compares with the 3.9 trillion-won average projection of seven analysts surveyed by Bloomberg News. Final operating profit was 5.2 trillion won on sales of 47.8 trillion won. Samsung shares fell 1.9 percent to 1,567,000 won in Seoul Wednesday, before the earnings release. The stock remains up about 24 percent this year.

The mobile unit posted the operating profit 100 billion won, a record low and down from 2.4 trillion won a year earlier. Operating income at the chip unit was 3.37 trillion won, compared with 3.7 trillion won a year earlier. A rise in memory chip prices as well as new products from device makers including Apple and Chinese manufacturers helped the division fare better in the quarter compared with its other businesses. Operating income from the display unit was 1.02 trillion won, up from 930 billion won.