Samsung Posts Sharp Drop in Q2 Profit
(MENAFN) South Korea's Samsung Electronics reported a sharp drop in operating profit for the second quarter, primarily driven by extraordinary costs in its semiconductor division, the company revealed Thursday.
Operating profit for the period from April to June plummeted 55.23 percent year-over-year, landing at 4.68 trillion won (3.4 billion USD), falling short of analysts’ expectations, which anticipated roughly 5.9 trillion won (4.2 billion USD).
While revenue inched up 0.67 percent to 74.57 trillion won (53.6 billion USD), net income suffered a steep 48.83 percent decline to 4.93 trillion won (3.5 billion USD).
Samsung attributed the sharp profit downturn to inventory valuation adjustments within its memory chip sector and extraordinary expenses stemming from export restrictions affecting its non-memory operations.
The chip division posted an operating profit of 400 billion won (287.6 million USD) on sales totaling 27.9 trillion won (20.1 billion USD) for the quarter.
To meet strong server demand in memory chips, Samsung boosted sales of high-bandwidth memory 3E (HBM3E) and increased the share of high-density double data rate 5 (DDR5) products.
The company anticipates sustained high demand for artificial intelligence (AI) applications in the latter half of 2025, fueled by ongoing investments from major cloud service providers.
Samsung’s foundry business plans to accelerate production of a cutting-edge mobile system-on-a-chip (SoC) using the advanced 2nm gate-all-around (GAA) process during the second half of the year.
The display panel division delivered an operating profit of 500 billion won (359.5 million USD) on revenues of 6.4 trillion won (4.6 billion USD) for the quarter.
Growth in mobile display panel sales was driven by new smartphone launches and expanding sales in IT and automotive sectors, while large display sales gained momentum, particularly for QD-OLED monitors, supported by strong demand in the gaming market.
Samsung forecasts that mobile display sales will continue to rise in the second half, supported by upcoming smartphone releases, alongside efforts to maintain stable large panel supplies for television manufacturers.
The mobile phone and networks segment generated an operating profit of 3.1 trillion won (2.2 billion USD) on revenue of 29.2 trillion won (21 billion USD) during the quarter.
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