To offset earnings miss, tech giant launches W3.91tr buyback with major share cancellation
Jul. 08, 2025, Jul. 08, 2025 –
Samsung Electronics forecast its earnings to fall significantly short of market expectations in the second quarter this year, dragged down by weak semiconductor sales, unexpected inventory-related costs and growing uncertainties including US tariffs.
In its earnings guidance Tuesday, the tech giant predicted its consolidated sales to post 74 trillion won ($54.1 billion) for the April-June period, down 0.09 percent on-year. The operating profit estimate plunged 55.9 percent to post at around 4.6 trillion won.
The figures came in well below market consensus, which had forecast 76.2 trillion won in sales and 6.2 trillion won in profit, according to estimates compiled by market intelligence firm FnGuide.
While Samsung did not release a detailed breakdown of the earnings by business, it explained that its Device Solution division, which oversees the company's semiconductor business, saw a profit decline from the previous quarter due to inventory-related costs and the impact of US export controls on advanced AI chips to China.
Weak performance in the chip sector was further weighed down by large-scale inventory valuation losses.
Industry sources say Samsung likely cleared out older high-bandwidth memory products — such as those made before the advanced 12-high HBM3E currently undergoing Nvidia's quality testing — or chips that became difficult to sell due to US export restrictions to China.
Anticipating potential losses from the devaluation of the previously manufactured chips, Samsung appears to have preemptively booked these costs in the second quarter.
The chip giant also appears to have posted a loss in its non-memory business. Sales fell short of expectations due to US government export controls and related inventory write-downs occurred, affecting shipments of lucrative HBM chips.