Samsung Electronics has vowed to make a quick comeback after the Note 7 disaster.
The smartphone manufacturer has posted a plunge of 96% in its third quarter for mobile earnings.
Lowest in Past 8 Years
However, the company claims that it will soon recover from the downtrend. Samsung was forced to withdraw all the Note 7 devices that it had sold to consumers due to the fire issues. This dragged down the mobile phone sector earnings to its lowest level seen in the past 8 years. The result was announced after the mass recalling of the Note 7 and the cancellation of the production. However, the company has been spared from a loss, though the total profit has hit the lowest possible level.
Probe Into Issue
According to Samsung, the company is still probing into he fires caused by the batteries. The company has reassured its investors that it will find out the cause of the product failure, which is the worst ever in the history of technology. The co vice chairman and the co chief executive officer of the company, Kwon Oh Hyun, spoke at the special general meeting that was held in Seoul, in South Korea, on the 27th of October.
The company has held out brighter prospects for the future offering more returns, by giving information regarding abuyback of share. It also increased the semiconductor business and has promised that the company will consider the proposals of corporate makeovers from Elliott Management, a US Hedge fund.
Winning Back Trust
J.K.Shin, the co chief executive of the company stated at a meeting held in Seoul after the company results were announced, that Samsung would try its utmost to win back the trust and is committed to this task. The statement was made as a part of the apology for the Note 7 debacle.
Changes in Management
Investors are expecting that the company will make some sweeping changes in the management as a reaction to the Note 7 issue. This was especially so when Jay Y. Lee, a de facto chief of Samsung Group was m voted to become the director of Samsung Electronics. Lee is the son of Lee Kun hee, who is in hospital due to a heart attack and he will now be me more accountable in the flagship company of the Samsung group. The mandate shows that he is expected to play a more public role while setting up strategies for the flagship company.
Will Heads Roll?
Though shareholders and investors are expecting some heads to roll, they might have to be patient till the investigations regarding the Note 7 are completed. It is only after that they can hope to see some of the heads of this family run group roll. According to Kwon Oh hyun, the Chief Executive, responsibilities would be assigned to people only after the crisis had been successfully resolved.