Samsung announced last week that it would be recalling its new Galaxy Note 7 smartphone, the company has sold 2.5 million units of the device since it launched last month.
Samsung will be replacing all units of the Galaxy Note 7 due to an issue with the battery in some devices and it could end up costing Samsung a significant amount of cash to recall the devices.
According to a recent report the Galaxy Note 7 recall could end up costing Samsung close to $1 billion, this is assuming that they replace the 2.5 million handsets they have sold.
Samsung has acted quickly to recall the handsets as it wants to limit the damage that this recall and problems with the handset could have done to their brand.
Whilst $1 billion seems like a lot, this is only a small proportion of their income for this year, probably less than 5%, if they had done nothing, the battery issue could have damaged their handset sales and also their brand and could have ended up costing them considerably more.
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