Samsung Electronics fighting damage control from discontinuation of its newest flagship smartphone model Galaxy Note7 pledged to implement 27 trillion won ($23.7 billion) in investment within the year to upgrade and expand facilities in manufacturing its two component strengths - next-generation semiconductor and flexible display.

South Korea’s electronics giant in a disclosure statement Thursday it has budgeted 13.2 trillion won to accelerate shift to next-generation memory chip fabrication and expand lines for V-NAND flash memory and system application processors and another 10.9 trillion won in ramping up capacity in flexible organic light emitting diode (OLED) panels.

The largest-ever single-year capital investment comes amid a major flop in its hardware operation - still-unidentified combustion-prone Galaxy Note7 that led to recall on all 2.5 million units sold in the first month and refund after the replacement phones also caught fire. The debacle took a heavy toll on the company’s reputation as the world’s top smartphone maker as well as its balance sheet.

On Thursday, the company confirmed third-quarter operating profit at 5.2 trillion won, down 36.2 percent on quarter and 29.7 percent on year. Sales dropped 6.1 percent on quarter and 7.5 percent on year to 47.82 trillion won.

It said it had reflected the cost of refund, recall and losses from discontinuation of Galaxy Note7 that was first released in August. Samsung Electronics earlier estimated 2.5 trillion won losses from the Galaxy Note7 debacle in the fourth quarter and another 1 trillion won in the first quarter of next year.

Shares of Samsung Electronics traded at 1,598,000, up 1.98 percent, or 31,000 won, as of 11:20 a.m. on Thursday from the previous session.

By Lee Dong-in

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]