11 October 2016: Samsung kills the exploding Galaxy Note 7
After reports of replacement phones also catching fire, Samsung permanently halted production and sales of the Galaxy Note 7. Its shares fell about 8 percent that day, wiping out roughly $18 billion in market value. The recall cost billions and was a brand disaster. Yet Samsung's chip business was so strong that the stock went on to hit record highs within months.
The lesson: One bad product rarely sinks a company with a deep, profitable core business.
What it meant for investors
$1,000 in Samsung at the start of 2018 → $1,744 today, vs $2,519 in the S&P 500.
We start the clock at the start of 2018, the first year in our price data after the event. That is 1.7 times the money, but $774 less than a plain index fund made over the same years.
What Samsung teaches: Being the best operator in a cyclical industry does not exempt you from the cycle; memory-chip gluts and shortages shaped returns more than any single product launch.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2015 | $21.00 | $3,571 | $3,301 |
| 2018 | $43.00 | $1,744 | $2,519 |
| 2020 | $47.00 | $1,596 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought Samsung? Every starting year and the full story →
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