According to Yonhap News and Reuters, due to a slowdown in the sales of Samsung Electronics' artificial intelligence chips in the United States and China, the company's operating profit for the second quarter decreased by 55.94% year-on-year, falling below market expectations.
Yonhap News
According to performance data released by Samsung Electronics on July 8 local time, the company's operating profit for the second quarter of this year decreased by 55.94% year-on-year, reaching 4.6 trillion won (approximately RMB 23.99 billion). Sales decreased by 0.09% year-on-year and fell 6.49% quarter-on-quarter, reaching 74 trillion won.
The operating profit also declined by 31.24% quarter-on-quarter, which was 23.4% lower than the market expectation (6.0069 trillion won) calculated by Yonhap News's financial information subsidiary, United Infomax. In terms of quarterly operating profit, it is the lowest since the fourth quarter of 2023 (2.8247 trillion won), and in terms of annual second quarters, it is the lowest since the second quarter of 2023 (668.5 billion won).
According to the report, Samsung attributed the decline in profits to restrictions on advanced artificial intelligence chips in the United States to China. In a statement, Samsung said, "Due to inventory value adjustments and the impact of U.S. restrictions on advanced AI chips in China, the profit of the Device Solutions (DS) division, which is responsible for chip business, declined quarter-on-quarter."
The statement also mentioned that its improved high-bandwidth memory (HBM) products are undergoing customer evaluation and continue to be shipped. Reuters pointed out that the statement did not provide further details on this.
The report showed that Samsung did not disclose specific performance figures for each department on August 8 local time, but South Korean securities companies generally believe that the operating profit of the DS department exceeded 1 trillion won. The mobile experience (MX) department and network project department responsible for smartphone business had operating profits of more than 2 trillion won, the display department between 600 billion to 700 billion won, the television and home appliance department between 400 billion to 500 billion won, and the automotive electronics department between 300 billion to 400 billion won.
Some views predict that after Samsung Electronics' performance hit a bottom in the second quarter, it will show a recovery trend in the second half of the year, driven by the storage business. This is because expectations for an increase in prices of memory chips have risen in the industry, and the mobile and display businesses, which support performance during the chip off-season, will also enter the peak season.
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