Operating Profit Seen Plunging 15% from Previous Quarter
Samsung Electronics is bracing for a sharp decline in operating profit for the second quarter of 2025, with estimates signaling a fall of over 15% compared to the first quarter. Projections peg Q2 profits at approximately 5.5 trillion won (about $4.2 billion), down from 6.7 trillion won ($4.4 billion) in Q1 and well below analyst expectations for the period[1][3].
- Q2 profit estimated at 5.5–5.7 trillion won
- More than 1 trillion won drop from Q1 2025
- About 15% below previous quarter and analyst forecasts
Semiconductor Segment Faces Setbacks
The downturn is attributed primarily to continued struggles within the company's
semiconductor division. Despite a global surge in demand driven by artificial intelligence development, Samsung has been unable to fully exploit the boom. The firm’s 12-layer HBM3E memory chips have yet to receive crucial approval from Nvidia, limiting access to the lucrative high-bandwidth memory market[3].
- HBM3E chips face certification delays due to quality issues; Samsung misses out on key AI chip opportunities
- Poor yields on 3nm chip production hinder foundry growth and customer acquisition
- Semiconductor business remains under pressure despite broader industry AI momentum
Additionally, increased U.S. tariffs and rising logistics costs have dragged down profitability across Samsung’s smartphones, TVs, and home appliance divisions[1][3].
Galaxy S25 and Other Divisions Underperform
The
Galaxy S25, Samsung’s flagship smartphone launched in February 2025, has not met sales expectations, reportedly impacted by deteriorating global economic conditions. The company’s home appliance and television sectors have also been hit by unfavorable tariff environments and logistics pressures[1][3].
Industry and Investor Response
The Q2 profit warning signals broader challenges for Samsung as it navigates a competitive technology market and volatile global economy. Gaining
Nvidia's approval for its HBM chips is now considered critical for a turnaround in the firm’s semiconductor business, and to capitalize on the current surge in demand for AI-related hardware[3].
Despite these setbacks, Samsung remains a central player in the tech industry, with developments in its operational strategy closely watched by investors and industry analysts worldwide.
