Preorders for Samsung's (SSNLF) new Galaxy S8 smartphone set a new record for the company previously held by its predecessor, the S7, as customers seem to have moved past the battery issues that caused the Note 7 to overheat and sometimes explode.
Samsung released a statement claiming that preorders for the S8 were 30% greater than for the S7, which was released last March. This broke Samsung's preorder record previously held by the S7. "We are delighted to see the response to the Galaxy S8 and S8+," Samsung Electronics America president Tim Baxter said in the statement. While Samsung did not release specific sales figures, earlier reports said the phone had pre-sold 550,000 units in the first two days it was available starting April 7.
While the phone is offering a stunning edge-to-edge infinity OLED display, a new digital voice assistant named Bixby, facial recognition and an iris scanner, the impressive sales are still significant considering the company's last flagship phone launch ended with the company setting a much different record: its largest recall ever. The damages from the Note 7 recall ended up costing the company $5 billion even though just 330 of the three million Note 7 devices sold were affected.
Baxter seemed to hint that the sales figure was a sign that customers are staying loyal to Samsung in spite of the Note 7 episode. "At Samsung, we believe it is a privilege to make groundbreaking products that are enjoyed by millions, and have recommitted ourselves to innovate, not only with new products and services, but also in process," he said. "The response is humbling, energizing, and points to a great launch week," Baxter added.
The claim about the record number of preorders is in line with a statement that Samsung's President of Mobile Communications Koh Dong-jin made earlier this month at a media briefing: "Initial market response is better than expected. I think the Galaxy S8 will be the first device to regain customers' trust and love."
The claim is also in line with the company's high expectations for total sales of its new flagship phone in 2017. The company sees the Galaxy S8 selling a total of 60 million units this year, vs. about 48 million S7 units sold in 2016, according to the report. HMC Investment Securities analyst Greg Roh said he also expects the S8 to outsell the S7 but not by as much. He's expecting Samsung to sell 50 million S8 units this year, which would translate to about $28.3 billion in sales.
While the S8 seems to be successfully luring customers to upgrade their phones, it has also drawn a number of complaints in its first few days on the market. A number of customers have noted an annoying red hue on its display, as well as spotty Wi-Fi connection. Samsung responded by saying it would release two software updates this week for the separate problems. The company told the Wall Street Journal that neither issue was a problem with the actual hardware, as was seen with the batteries in the Note 7.
In addition, protection plan company Square Trade released a study on Monday showing that the Galaxy S8 and S8+ were significantly more prone to breaking than the S7 and S7 Edge because the new phones have all-glass front and back panels. The S8 and S8+ scored a 76 and 77 on a 1-100 scale for breakability in which the higher the number, the more breakable it is. Last year's Galaxy S7 and S7 Edge received a 50 and 60, respectively. Apple's (AAPL) iPhone 7 and 7 Plus, which launched last September, also scored a 50 and 60, respectively. This year's iPhone 8 is widely expected to implement larger curved glass screens similar to the S8, which might make them more susceptible to breaking as well.
While SquareTrade's conclusion about the phone's hardware isn't great for Samsung, a SquareTrade executive said he didn't think it would matter much. "While the nearly all-glass design of the S8 makes it a beautiful phone, it's extremely susceptible to cracking when dropped from any angle," said Jason Siciliano, vice president global creative director at SquareTrade. "However, we have no doubt it's going to be a hit. We found that 89% of Samsung owners reported having a positive view of the brand despite recent controversies, and 36% plan on buying an S8 in the next six months. Just don't drop it."