Samsung recently countered battery exploding incidents for Galaxy Note 7 upon which there were mixed statements by the company and other resources regarding the remedy. Undoubtedly, this is one hardest decision Sammy has come across so far.

The grave part is this isn’t just damaging the company’s image, rather the repercussion of the recall of shipped units is hefty including the cost. 

Hwang Min-sung, an analyst at Samsung Securities, while estimating the damage evaluates that cost might go up to $108.5 million, which includes the replacement process. This is the amount required to recall and replace all the handsets that have been shipped to customers and retailers.

However, the expenditure will also expand to the handset manufactured in September which will also be a part of replacement program.

As more replacement occurs and less sales happens, there is chance of operating profits shrinking to approximately $360 million and the recall program is estimated to usurp $270 million, as per analyst.

According to Hwang, “the recall is a negative factor in the short term but will surely be a wise decision because other alternative measures are unlikely to help Samsung regain confidence from consumers and investors.”

In the nutshell, Samsung profit will reduce by $740 million by the end of this year, if we are to believe the numbers estimated by Samsung Securities’ analyst.