Profit Forecast Highlights Sluggish Chip Momentum
Analysts expect Samsung to announce a 39% drop in operating profit for the second quarter of 2025, projecting earnings of 6.3 trillion won (about US$4.62 billion) for the April–June period, according to LSEG SmartEStimates. That would mark Samsung’s lowest quarterly income in six quarters.
While global demand for memory chips used in AI applications has soared, Samsung’s financial performance has lagged behind rivals SK Hynix and Micron Technology. Both competitors have capitalized on booming demand for high-bandwidth memory (HBM) chips that power AI data centers, while Samsung’s gains have remained subdued.
Challenges in Nvidia Certification and China Restrictions
A key drag on Samsung’s memory chip business has been delays in securing Nvidia’s certification for its latest HBM3E 12-high memory chips. These advanced chips are critical for training large AI models, and Nvidia remains the dominant customer in the AI accelerator market.
Analysts say Samsung’s revenue from HBM sales likely stagnated in the second quarter due to persistent restrictions on selling advanced chips to China and delays in Nvidia certification.
“HBM revenue likely remained flat in the second quarter, as China sales restrictions persist and Samsung has yet to begin supplying its HBM3E 12-high chips to Nvidia,” noted Ryu Young-ho, senior analyst at NH Investment & Securities. He added that significant shipments to Nvidia were unlikely this year.
Samsung previously suggested in March that meaningful progress in its HBM business might come as early as June. However, the company declined to confirm whether its newest HBM3E chips had passed Nvidia’s rigorous qualification process. Despite this, Samsung has reportedly begun supplying these chips to Advanced Micro Devices (AMD), offering a partial offset to the Nvidia delay.
Smartphone Sales Offer Limited Cushion
Outside the memory segment, Samsung’s smartphone division has shown relative resilience. Analysts point to strong stockpiling ahead of potential US tariffs on imported smartphones, which has helped support sales volumes in the near term.
However, trade policy risks remain a cloud over the business. The Biden administration is considering measures such as a 25% tariff on non-US-made smartphones and new “reciprocal” tariffs against trading partners after July 9.
Meanwhile, the US government is also weighing revoking certain licenses that allow global chipmakers, including Samsung, to receive critical US technology at their facilities in China—a move that could disrupt supply chains and further complicate Samsung’s competitive outlook.
Pressure Mounts on Semiconductor Strategy
Samsung’s struggle to keep pace with competitors in the AI chip market has become a growing concern for investors. The firm’s slow progress in HBM development has raised questions about its ability to defend its leadership in memory technology amid an industry pivot to AI-driven demand.
While rivals like SK Hynix have become key suppliers of HBM chips to Nvidia, Samsung’s reliance on the heavily restricted China market has left it vulnerable to US export controls.
Despite these challenges, Samsung’s stock has managed a roughly 19% gain so far this year, but that still lags the broader Kospi index’s 27.3% rise, making it the weakest performer among major global memory chipmakers.
Outlook Remains Uncertain
As Samsung prepares to release its official second-quarter results, investors will be watching for signs of progress on HBM production and certification, as well as the company’s broader strategy to navigate geopolitical headwinds and trade risks.
While its smartphone sales may provide short-term support, Samsung’s long-term prospects will depend heavily on whether it can successfully reassert its leadership in advanced memory technology at the center of the global AI boom.