Headquarters of Samsung in Mountain View, California, on October 28, 2018.
Smith Assortment/gado | Archive Images | Getty Pictures
Samsung Electronics on Thursday reported a second-quarter working revenue of 4.7 trillion Korean gained, lacking expectations, weighed by a 93.8% revenue droop in its chip enterprise.
Whereas Samsung’s second-quarter working revenue beat its personal forecast of round 4.6 trillion gained, it was a steep drop from the ten.44 trillion gained recorded in the identical interval final 12 months.
The South Korean expertise big posted a quarterly income of 74.6 trillion gained, up barely from 74.07 trillion gained a 12 months earlier and beating its forecast of 74 trillion gained.
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 gained ($53.5 billion) vs. 74.43 trillion gained
- Working revenue: 4.7 trillion gained vs. 5.33 trillion gained
Shares of Samsung fell by as a lot as 1.79% in early buying and selling.
Notably, its System Options division, which encompasses its reminiscence chip, semiconductor design and foundry enterprise items, recorded a 93.8% drop in working revenue 12 months over 12 months.
Samsung Electronics’ chip enterprise posted an working revenue of 400 billion gained within the second quarter, plunging from 6.45 trillion gained in the identical interval final 12 months. Chip income fell to 27.9 trillion gained, from 28.56 trillion gained final 12 months.
“Stock worth changes in reminiscence and one-off prices associated to the impacts of export restrictions associated to China in non-memory had an hostile impact on revenue,” the corporate mentioned in an announcement.
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 disclosed on Monday.
Whereas Samsung didn’t disclose the counterparty, Tesla CEO Elon Musk has mentioned that it was his American electrical automobile maker, and that the so-called AI6 chips could be made at Samsung’s upcoming fab in Taylor, Texas. The deal might be even bigger than what’s been introduced, Musk added.
The primary goal of the Tesla deal for Samsung might be attracting different potential clients to its foundry enterprise, Nam Hyung Kim, analysis companion and fairness analysis analyst at Arete, instructed CNBC.
“Manufacturing prices on the Taylor website are anticipated to be considerably greater than these in Korea,” he mentioned, 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.
In the meantime, Samsung has been coping with elevated competitors in its reminiscence enterprise, which makes chips used to retailer information in the whole lot from servers to client gadgets equivalent to smartphones and laptops.
The corporate has fallen behind reminiscence rival SK Hynix in excessive bandwidth reminiscence, or HBM — a sort 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 world reminiscence market.
Within the second half of the 12 months, Samsung mentioned it plans to proactively meet the rising demand for high-value-added and AI-driven merchandise and proceed to strengthen competitiveness in superior semiconductors.
Client gadgets
Samsung’s cell expertise and networks companies, tasked with growing 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 gained for the second quarter, in comparison with 2.23 trillion gained throughout the identical interval final 12 months.
Consolidated income for the unit reached 29.2 trillion gained, up from 27.38 trillion gained final 12 months.
Samsung mentioned that each income and working revenue grew 12 months over 12 months by means of 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 world 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 maintain up with choices from Chinese language rivals.