Samsung Electronics is expected to report a 39 percent drop in second-quarter operating profit on Tuesday, as delays in supplying advanced memory chips to Nvidia weigh on earnings.
The projected April-June profit is 6.3 trillion won, or about $4.62 billion, which would be its lowest in six quarters, according to LSEG SmartEstimate.
Samsung continues to face challenges in getting its latest HBM3E 12-layer chips certified by Nvidia. The company had expected progress by June but has not confirmed whether the chips passed Nvidia’s qualification process. However, Samsung began supplying the new chip to AMD in June.
High-bandwidth memory chips are used in AI data centers and are in strong demand. Samsung’s competitors, SK Hynix and Micron, have already seen gains in this market. Samsung’s progress has been slower, partly due to U.S. restrictions on advanced chip sales to China, which is one of its key markets.
HBM revenue likely stayed flat in the second quarter, and shipments of the HBM3E chip to Nvidia may not increase significantly this year.
Samsung’s smartphone sales are expected to remain stable, supported by stockpiling ahead of possible U.S. tariffs on imported smartphones. The company is also dealing with ongoing business risks from U.S. trade policies, including proposed 25 percent tariffs on non-U.S.-made smartphones and a July 9 deadline for reciprocal tariffs on imports from several countries.
The U.S. government is considering revoking licenses that allow global chipmakers like Samsung to receive U.S. technology at their China-based factories.
Samsung shares have risen about 19 percent this year but continue to underperform the benchmark KOSPI index, which is up 27.3 percent. As of 0447 GMT on Monday, Samsung shares were down 1.9 percent, while the KOSPI rose 0.3 percent.
