Headquarters of Samsung in Mountain View, California, on October 28, 2018.
Smith Assortment/gado | Archive Pictures | Getty Pictures
Samsung Electronics on Thursday reported a second-quarter working revenue of 4.7 trillion Korean received, lacking expectations, weighed by a 93.8% revenue hunch in its chip enterprise.
Whereas Samsung’s second-quarter working revenue beat its personal forecast of round 4.6 trillion received, it was a steep drop from the ten.44 trillion received recorded in the identical interval final yr.
The South Korean expertise large posted a quarterly income of 74.6 trillion received, up barely from 74.07 trillion received a yr earlier and beating its forecast of 74 trillion received.
Listed here are Samsung’s second-quarter outcomes in contrast with LSEG SmartEstimate, which is weighted towards forecasts from analysts who’re extra persistently correct:
- Income: 74.6 trillion received ($53.5 billion) vs. 74.43 trillion received
- Working revenue: 4.7 trillion received vs. 5.33 trillion received
Shares of Samsung fell by as a lot as 1.79% in early buying and selling.
Notably, its Gadget Options division, which encompasses its reminiscence chip, semiconductor design and foundry enterprise models, recorded a 93.8% drop in working revenue yr over yr.
Samsung Electronics’ chip enterprise posted an working revenue of 400 billion received within the second quarter, plunging from 6.45 trillion received in the identical interval final yr. Chip income fell to 27.9 trillion received, from 28.56 trillion received final yr.
“Stock worth changes in reminiscence and one-off prices associated to the impacts of export restrictions associated to China in non-memory had an antagonistic impact on revenue,” the corporate stated in an announcement.
Nonetheless, talking in an earnings name, Samsung’s chief monetary officer Quickly-cheol Park voiced some optimism for the corporate within the close to time period.
“Regardless of ongoing international financial considerations pushed by unsure commerce insurance policies and geopolitical tensions, the IT trade seems poised for a gradual restoration fueled by rising momentum in AI and robotics,” he stated.
“On this context, we anticipate a rebound in our efficiency within the second half, following a bottoming out within the second quarter, with the earnings anticipated to enhance steadily because the yr progresses,” he added.
Foundry hopes, reminiscence woes
Samsung’s foundry enterprise may obtain a lift within the following quarters from a $16.5 billion contract to provide chips to a serious firm in a deal introduced on Monday.
Whereas Samsung didn’t initially disclose the counterparty, Tesla CEO Elon Musk has stated that it was his American electrical car maker, and that the so-called AI6 chips can be made at Samsung’s upcoming fab in Taylor, Texas. The deal might be even bigger than what’s been introduced, Musk added.
The principle purpose of the Tesla deal for Samsung might be attracting different potential clients to its foundry enterprise, Nam Hyung Kim, analysis accomplice and fairness analysis analyst at Arete, informed CNBC.
Nonetheless, “manufacturing prices on the Taylor web site are anticipated to be considerably larger than these in Korea,” he stated, including that it’s far too early to conclude the deal will enhance Samsung’s place in opposition to market chief Taiwan Semiconductor Manufacturing Firm.
Samsung’s foundry enterprise is at present at a “essential juncture between survival and profitability,” Neil Shah, vice chairman of analysis at Counterpoint Analysis, stated in a pre-earnings assertion.
Samsung, in the meantime, has been coping with elevated competitors in its reminiscence enterprise, which makes chips used to retailer knowledge in every thing from servers to shopper gadgets comparable to smartphones and laptops. The corporate has historically been the market chief within the house.
However Samsung’s power in reminiscence is being threatened because it falls behind rival SK Hynix in excessive bandwidth reminiscence, or HBM — a kind of reminiscence used for synthetic intelligence computing.
A report from Counterpoint Analysis earlier this month discovered that SK Hynix had caught up with Samsung’s reminiscence revenues within the second quarter, with each now vying for the highest place within the international reminiscence market.
Within the second half of the yr, Samsung stated it plans to proactively meet the rising demand for high-value-added and AI-driven merchandise and proceed to strengthen competitiveness in superior semiconductors.
Galaxy gross sales elevate cellular earnings
Samsung’s cellular expertise and networks companies, tasked with creating and promoting smartphones, tablets, wearables and different gadgets, reported an uptick in gross sales and revenue.
The unit posted an working revenue of three.1 trillion received for the second quarter, in comparison with 2.23 trillion received throughout the identical interval final yr.
Consolidated income for the unit reached 29.2 trillion received, up from 27.38 trillion received final yr.
Samsung stated that each income and working revenue grew yr over yr via sturdy gross sales of its Galaxy S25 collection and Galaxy A collection smartphones, in addition to its Galaxy tablets.
“In H2 2025, the [mobile experience business] plans to proceed a flagship-first strategy for smartphone gross sales specializing in foldables and the Galaxy S25 collection — whereas emphasizing the AI performance of the Galaxy A collection — to extend market share,” Samsung added.
Samsung efficiently defended its main place within the international smartphone market within the second quarter, in response to a report from expertise analysis agency Canalys, now a part of Omdia. Samsung claimed a 19% market share by unit gross sales, predominantly due to gross sales of its Galaxy A collection.
Earlier this month, Samsung launched three new folding smartphones as the corporate appears to be like to maintain up with choices from Chinese language rivals.
