Samsung Q2 profit slides 55% on weak chip sales, China export curbs

Published 31/07/2025, 01:24
© Reuters.

Investing.com-- Samsung Electronics Co Ltd (KS:005930) reported a 55% slide in its second-quarter operating profit on Thursday, with the tech conglomerate citing weak chip sales, especially due to U.S. curbs on exports to China. 

Samsung clocked a June quarter operating profit of 4.7 trillion won ($3.37 billion), largely in line with estimates released earlier in July. The figure had disappointed investors, given that it was well below market expectations of 6.37 trillion won.

Revenue fell 5.8% to 74.6 trillion won, in line with prior estimates. 

Samsung said that while its core memory chip unit did log stronger revenue on improving sales, its profitability was dented by costs related to U.S. export restrictions on the sale of advanced artificial intelligence chips to China. 

But Samsung said this cost was one-off, and that its chips division plans to meet the growing demand for AI products in the coming quarters, while also reducing the impact of U.S. trade tariffs. 

The company also flagged plans to prioritize its flagship smartphone sales in the second half of 2025 to boost market share. 

Samsung has largely lagged rivals such as SK Hynix Inc (KS:000660) and Micron Technology Inc (NASDAQ:MU) in developing advanced, high-bandwidth memory chips for customers such as Nvidia (NASDAQ:NVDA). HBM chips are a key component of the processors used to run AI programs. 

Still, Samsung’s earnings come just days after it signed a $16.5 billion chip supply deal with electric vehicle maker Tesla (NASDAQ:TSLA), which could help the South Korean giant reverse its fortunes. 

 

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