Analysts think Samsung should kill the exploding Galaxy Note 7 and move onto the 8


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Samsung's exploding Galaxy Note 7 disaster just keeps getting worse, and now some analysts think it might be time for the company to cut its losses and move on to the Galaxy Note 8.


The South Korean electronics giant halted sales and recalled its $882 flagship device on September 2 in countries around the world following reports that multiple devices had melted, burst into flames, or burned people.

On September 19, the company started replacing Galaxy Note 7 devices with new handsets that wouldn't spontaneously combust. But there's been one teenie-weenie problem. Some replacement devices (eight altogether) also overheated and caught fire. As a result, Samsung was left with little choice but to tell retailers to remove all of its Galaxy Note 7 devices from their shelves. Samsung says it has now stopped producing the Galaxy Note 7 altogether, according to The Associated Press.

Executives at Samsung will now want to move forward and focus on how they can rebuild trust among consumers, as companies like Apple and Google look to capitalise on Samsung's misfortune with devices like the iPhone 7 and the Pixel.

"It's now time for management to mull over the option of giving up Note 7 completely, as it has already missed the first three months of sales, an important window of opportunity, and the Note 7 phone appears to have lost confidence among customers," wrote Macquarie analysts in a note.


Here is a timeline of the Galaxy Note 7 debacle:

Samsung Galaxy Note 7 timeline


Edward Snyder, the managing director of Charter Equity Research, added: "This has probably killed the Note 7 brand name. By the time they fix the problem they have to go through recertification and requalification and by the time that happens they're going up against the Galaxy S8 launch."

The whole debacle could cost Samsung $17 billion (£13.8 billion), according to analysts at Credit Suisse. Meanwhile, there are concerns that the fiasco will have a detrimental impact on Samsung's overall brand.

"We think the Note 7 incident may hurt demand for Samsung's other smartphone models as well," Nomura analysts wrote in a note, adding that Samsung's mobile division could see its profits fall by as much as 85% in the fourth quarter.


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