Samsung`s posts $7 billion profit despite Note 7 recall

Seoul: Samsung Electronics saw its operating profit rise in the third quarter despite a global recall of Galaxy Note 7 smartphones, the company said on Friday.

The South Korean tech behemoth posted 7.8 trillion won ($7 billion) in its preliminary figure for operating profit during the July-September period, up 5.55 percent from the same period last year, Xinhua news agency.

It was down 4.18 per cent from 8.14 trillion won tallied in the previous quarter, which was the largest in more than two years.

The third-quarter profit beat market expectations of about 7.4 trillion won thanks to brisk sales of semiconductors and display panels, analysts said.

The better-than-expected earnings result came despite the companys decision in early September to recall all of about 2.5 million Galaxy Note 7 smartphones shipped across the globe.

A number of cases that the Note 7 phones caught fire while charging were reported, leading many airlines to prevent passengers from holding the phones on flight for a fire hazard of batteries.

According to the US Consumer Product Safety Commission, there were 92 reports of battery overheating in the US, including 26 cases of burns and 55 involving property damage.

It is estimated that Samsung may report about 1 trillion won in losses from the Note 7 recall, and the exact earnings results from businesses would be reported later this month after an external audit.