Samsung Profit Warning: Q2 Earnings May Plunge 39% Under Tech Lag & US Sanctions Vice

TradingKey - Samsung Electronics is expected to see its operating profit decrease by 39% year-over-year in Q2 2025, falling to 6.3 trillion won (approximately $ 5.6 billion), marking the lowest level in six quarters and the fourth consecutive quarter of decline.

Samsung initially aimed to gain a market edge with its HBM3E high-bandwidth memory chips. Still, its product certification and mass production schedule for core clients like Nvidia have consistently lagged. According to supply chain sources, Samsung forecasted a breakthrough in HBM chip development by June; however, it has still not passed final certification as of now, resulting in its HBM product line revenue remaining essentially flat compared to the same period last year.

In contrast, competitors such as SK Hynix have achieved a stable supply for Nvidia's H100 and H800 AI chips thanks to their more mature HBM3E mass production capabilities. Micron Technology has also managed profit growth driven by strong demand for HBM chips.

Meanwhile, export restrictions on advanced process chips implemented by the U.S. Department of Commerce have directly impeded Samsung's plans for expanding DRAM and NAND Flash capacity in China.

Despite Samsung Electronics' stock price increasing by 19% this year, its growth significantly lags behind the KOSPI index's performance of 27.3% during the same period, making it the worst-performing stock among major memory chip manufacturers in South Korea.