26.1 C
Indore
Monday, July 7, 2025
Home Gadgets Samsung Electronics Q2 profit likely to drop 39% on weak AI chip...

Samsung Electronics Q2 profit likely to drop 39% on weak AI chip sales – The Economic Times

Samsung Electronics is predicted to forecast a 39% plunge in second-quarter operating profit on Tuesday, weighed down by delays in supplying superior memory chips to synthetic intelligence chip chief Nvidia.

The world’s greatest maker of reminiscence chips is projected to report an April-June working revenue of 6.3 trillion received ($4.62 billion), its lowest earnings in six quarters, in keeping with LSEG SmartEStimate.

The extended weak point in its monetary efficiency has deepened investor issues over the South Korean tech large’s skill to meet up with smaller rivals in growing high-bandwidth reminiscence (HBM) chips utilized in synthetic intelligence knowledge centres.

Its key rivals, SK Hynix and Micron, have benefited from strong demand for reminiscence chips wanted for AI, however Samsung’s features have been subdued because it depends on the China market, the place gross sales of superior chips have been restricted by the U.S.

Its efforts to get the newest model of its HBM chips to Nvidia licensed by Nvidia are additionally shifting slowly, analysts stated.

“HBM income probably remained flat within the second quarter, as China gross sales restrictions persist and Samsung has but to start supplying its HBM3E 12-high chips to Nvidia,” stated Ryu Younger-ho, a senior analyst at NH Funding & Securities.

He stated Samsung’s shipments of the brand new chip to Nvidia are unlikely to be vital this yr.

Samsung, which anticipated in March that significant progress over its HBM chip may come as early as June, declined to touch upon whether or not its HBM 3E 12-layer chips had handed Nvidia’s qualification course of.

The corporate, nevertheless, has began supplying the chip to AMD, the U.S. agency stated in June.

Samsung’s smartphone gross sales are prone to stay stable, helped by demand for inventory forward of potential U.S. tariffs on imported smartphones, analysts stated.

A lot of its key companies together with chips, smartphones and residential home equipment proceed to face enterprise uncertainty from varied U.S. commerce insurance policies together with President Donald Trump’s proposal for a 25% tariff on non-US-made-smartphones and the July 9 deadline for “reciprocal” tariffs towards a lot of its buying and selling companions.

The U.S. can be contemplating revoking authorisations granted to world chipmakers together with Samsung, making it harder for them to obtain U.S. know-how at their vegetation in China.

Shares in Samsung, the worst performing inventory amongst main reminiscence chipmakers this yr, have climbed about 19% this yr, underperforming a 27.3% rise within the benchmark KOSPI.


Discover more from News Journals

Subscribe to get the latest posts sent to your email.

Most Popular

In a nation growing hostile toward drugs and homelessness, Los Angeles tries harm reduction

Los Angeles — Inside a brilliant new constructing within the coronary heart of Skid Row, homeless individuals frolicked in...

Samsung Electronics Q2 profit likely to drop 39% on weak AI chip sales – The Economic Times

Samsung Electronics is predicted to forecast a 39% plunge in second-quarter operating profit on Tuesday, weighed down by delays in supplying superior memory...

Recent Comments