Samsung has warned that the total cost of pulling its Galaxy Note7 smartphones off the market will be at least £4.4 billion.
The South Korean firm said on Friday that the discontinuation of its flagship phone would cost the company about 3.5 trillion won (£2.5 billion) during the current and next quarter.
Samsung had already cut its third-quarter profit forecast by £1.9 billion earlier this week, an amount that could wipe out its entire mobile business profit.
But Samsung has enough cash to absorb the shock from the phone recall. The company said it expects to generate 5.2 trillion won (£3.7 billion) in operating profit during the third quarter after the recall cost.
Samsung added that it will make significant changes in its quality assurance processes to enhance product safety for consumers.
The company said it will expand sales of two other smartphones released in spring – the Galaxy S7 and Galaxy S7 Edge – quashing rumours that it may try to release updated versions of those devices.