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Samsung Note 7 Demand Strains Supply Chain, Causes Delays

By Diana Goovaerts | August 24, 2016

It’s a good problem to have, but a problem nonetheless.

Sky-high demand for Samsung’s new Galaxy Note 7 smartphone is putting a strain on the manufacturer’s supply chain and forcing the company to push back launch dates, Reuters reported Wednesday.

According to the report, preorders for the new device have “far exceeded” Samsung’s expectations. As a result, the company said it has had to adjust the device’s release date in a number of unspecified markets while it works to boost supply and meet demand “as early as possible.”

Though the situation appears to be reminiscent of production issues with the curved displays of last year’s Galaxy S6 Edge, a Reuters source said there is no issue with the Note 7’s curved screen. The supply shortage, the source said, is not expected to be a long-term problem.

Samsung stocks were down two percent Wednesday morning on fears the delay would result in disappointing sales as in the case of the Galaxy S6.

Unveiled earlier this month, the Note 7 became available for preorder at the top five largest U.S. wireless carriers on August 19. The 5.7-inch device boasts a water-resistant body and S Pen, an iris scanner, a Qualcomm Snapdragon 820 processor running Android Marshmallow, fast wireless and wired charging and a 12 mp rear camera. New to the Note 7 is USB Type-C charging, as well as a redesigned S Pen with a finer point and better pressure sensitivity.

The demand for the Note 7 is perhaps unsurprising given the overwhelming success of Samsung’s other flagship devices, the Galaxy S7 and S7 Edge.

In the first half of this year, the S7 Edge and S7 were the number one and number three top selling Android smartphones, according to Strategy Analytics figures. Approximately 13.3 million S7 Edge units were shipped through June, while Samsung shipped around 11.8 million units of the S7. Both devices were unveiled at Mobile World Congress in February, giving sales a head start ahead of Apple’s spring iPhone update.

In July, sales of the S7 helped propel Samsung profit to a two-year high.


Filed Under: Devices

 

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