Samsung sign during the NVIDIA GPU Technology Conference (GTC) held in San Jose, California, USA on Thursday, March 20th, 2025.
David Paul Morris | Bloomberg | Getty Images
South Korea Samsung Electronics On Tuesday, profits fell by 56% in the second quarter as the company struggles to capture demand from artificial intelligence chip leader Nvidia.
Memory chips and smartphone makers forecast operating profit for the quarter ending in June, down from 10.44 trillion yen from the previous year.
This number is a deeper lunge compared to LSEG's SmartEstime, and is weighted to more consistently accurate predictions from analysts.
According to LSEG Smartestimate, Samsung was expected to record operating profit of 6.26 trillion won ($4.57 billion). quarter. Meanwhile, Samsung predicted its revenues reached 74 trillion won, not reaching its LSEG smart estimate of 75.55 trillion won.
Samsung is a leading player in the global smartphone market and is also one of the world's largest manufacturers of memory chips used in devices such as laptops and servers.
However, the company is behind its competitors Sk Hynix and micron High Bandwidth Memory Chip – Advanced type of memory deployed on AI chips.
“The unfortunate revenues are due to the ongoing operating losses in the foundry business, but the benefits of the margin HBM business remained in tune for the quarter,” said Hwang, research director at CounterPoint Research, regarding revenue guidance.
HBM leader SK Hynix has secured its position as Nvidia's leading supplier. Samsung is reportedly working to get the latest version of the Nvidia-certified HBM chips, but reports from local outlets suggest that these plans have been pushed back to at least September.
The company did not respond to requests for comment regarding the status of its deal with Nvidia.
Ray Wang, Futurum Group's supply conductor, supply chain and emerging technologies research director, told CNBC it is clear that Samsung has yet to pass Nvidia's most advanced HBM qualification.
“Late increases meaningfully in the short term given that NVIDIA accounts for around 70% of global HBM demand,” Wang said. He pointed out that Samsung has secured HBM supply of AI processors from AMD, but the victory is unlikely to contribute to second quarter results due to the timing of the production lamp.
Meanwhile, Samsung's chip foundry business continues to face weak order and serious competition Taiwan Semiconductor Manufacturing Companythe king added.
Reuters reported in September that Samsung had directed its subsidiaries around the world to cut 30% of staff in several divisions.
According to LSEG data, Samsung Electronics stock has grown by around 16% since the start of the year. The company will release detailed third quarter results towards the end of this month.
