Samsung recalled the Note 7, declared it fixed — then the replacements caught fire too

Samsung launched the Galaxy Note 7 on 2 August 2016. Within weeks, reports emerged of phones overheating, catching fire and exploding while charging. On 2 September, Samsung announced a global voluntary recall of about 2.5 million devices, blaming a battery-cell defect from one supplier. The US Consumer Product Safety Commission issued a formal recall of roughly 1 million phones on 15 September. Samsung began distributing replacement units with batteries from a different supplier.

The replacements also caught fire. On 5 October, a replacement Note 7 smoked on a Southwest Airlines flight, prompting evacuation. Samsung had declared the problem fixed before understanding it. On 11 October, Samsung permanently discontinued the Note 7. In January 2017, the root cause was announced: battery defects from two suppliers. The premature conclusion — blaming one supplier and shipping replacements before the investigation was complete — turned a recall into a crisis of confidence.

The financial impact was severe. Samsung estimated about 3.1 trillion won (roughly $2.8 billion) in lost operating profit in Q3 2016 alone, with total Note 7-related costs commonly estimated at $5 billion or more. Samsung's share price fell sharply after the final halt, wiping out roughly $17 billion in market value in a single day. The recall-to-replacement-to-second-recall sequence made the crisis look worse than a single-product defect and damaged trust in Samsung's safety assurances.