Samsung Electronics has reported a brutal 55.5 per cent year-on-year plunge in operating profits for the second quarter, laying the blame squarely on US export restrictions that have battered demand for advanced AI chips in China.
The South Korean tech titan revealed Thursday that its April–June profit stood at 4.7 trillion won (£2.7bn), down from 10.8 trillion won last year, according to its regulatory filing.
While revenues improved from the first quarter, Samsung admitted that earnings for its Foundry Business remained “weak due to the impact of inventory value adjustments” tied to the tightening US rules.
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The timing couldn’t be more dramatic, as the company just inked a jaw-dropping $16.5 billion deal with Tesla to supply AI6 chips through to 2033, showcasing its ambitions despite market turbulence.
Analysts warn that the US-China tech war is beginning to take its toll on Asia’s most iconic electronics manufacturer.
Samsung Electronics is the crown jewel of the powerful Samsung Group, South Korea’s largest chaebol and the main engine behind the nation’s export-driven economy.
The results have sparked concerns about how further geopolitical tensions could hinder innovation and dent long-term growth in the fiercely competitive chip industry.
