April 30, Samsung Electronics released its Q1 2025 financial results. The report showed that the company's DS Division (Semiconductor Division) had a quarter-on-quarter decline of 62.1% in operating profit to 1.1 trillion Korean won (approximately RMB 56.0 billion), with revenue at 25.1 trillion Korean won (approximately RMB 1277.6 billion), a quarter-on-quarter decrease of 17%, but an increase of 9% year-over-year.

In the financial report, Samsung pointed out that its overall profitability was impacted by the decline in average selling prices and partly due to the reduced sales of high-bandwidth chips (HBM) caused by export controls on artificial intelligence chips.

According to Nikkei Asia, Samsung Electronics stated that the U.S. advanced chip export control on China is harming its business in China.

Kim Jae-jun, vice president of Samsung Electronics' memory division, said at the earnings conference call, "We believe that the uncertainty of demand in the second half of the year is increasing due to recent changes in tariff policies in major countries and the strengthening of export controls on AI chips."

However, Chief Financial Officer Park Choon-cheol of Samsung said, "Assuming current uncertainties are alleviated, we cautiously expect that as we enter the second half of the year, overall performance will gradually improve."

Samsung Electronics

China is Samsung's largest market, accounting for nearly one-third of its total revenue last year by region. According to Samsung's 2024 annual report, the total value of products exported to China by the company last year reached 64.9 trillion Korean won (approximately RMB 3303.4 billion), an increase of 53.9% year-over-year, slightly higher than its export amount to the United States (61.4 trillion Korean won, approximately RMB 3125.2 billion).

The sales of Samsung Semiconductor Co., Ltd., a NAND flash manufacturing subsidiary located in Xi'an under Samsung Electronics, were 11.2 trillion Korean won (approximately RMB 570.1 billion) last year, compared to 8.7 trillion Korean won (approximately RMB 442.8 billion) the previous year; the sales of Shanghai Samsung Semiconductor, a sales subsidiary of Samsung Electronics, in 2024 were 30.1 trillion Korean won (approximately RMB 1532.1 billion), more than doubling from 15.6 trillion Korean won (approximately RMB 794.0 billion) the previous year.

Previously, the Biden administration issued three rounds of export control rules targeting China's chip industry, involving measures such as prohibiting the sale of specific types of semiconductors and restricting exports of chip manufacturing equipment.

However, Samsung's Device Experience Division (including businesses in visual displays, home appliances, smartphones, etc.) performed well, with operating profit in the first quarter doubling to 4.7 trillion Korean won (approximately RMB 239.2 billion), and revenue surged by 28% quarter-over-quarter to 51.7 trillion Korean won (approximately RMB 2631.5 billion). This was mainly due to the popularity of its latest model phones equipped with artificial intelligence services.

In general, Samsung's operating profit increased by 1.2% year-over-year to 6.7 trillion Korean won (approximately RMB 341.0 billion), and revenue increased by 10.1% year-over-year to 79.1 trillion Korean won (approximately RMB 4026.2 billion).

Regarding the development of the second quarter, Samsung proposed to accelerate the mass production of enhanced HBM3E 12H products to meet initial market demand, strengthen competitiveness through high-value-added businesses centered on high-density servers, and accelerate the migration of the eighth-generation V-NAND technology to enhance product competitiveness.

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Source: https://www.toutiao.com/article/7499012249621758474/

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