Samsung Electronics Co. Ltd. today reported a steep decline in quarterly profits as a result of ongoing volatility in the semiconductor market, as the company’s chip business once again weighed on overall earnings.

For the quarter that ended on June 30, Samsung reported consolidated revenue of 74.6 trillion won ($57.4 billion), up 1% year-over-year but down 6% from the previous quarter. Operating profit fell to 4.7 trillion won ($3.6 billion), down 55% year-over-year and 30% from the previous quarter, while net profit dropped to 48% year-over-year, to 5.1 trillion won ($3.9 billion).

The results were highly influenced by Samsung’s Device Solutions division, which includes its semiconductor business. There were some positives, with memory chip revenue growing 11% quarter-over-quarter to 21.2 trillion won ($16.3 billion), driven by increased demand for DDR5 and HBM3E chips used in artificial intelligence servers. But profitability fell sharply. Operating income from the division dropped to just 0.4 trillion won ($308 million), down 94% year-over-year.

Samsung’s foundry business also continued to struggle in the quarter, as U.S. export restrictions on advanced AI chips to China dented sales.

The figures were not all doom and gloom, however. Samsung’s Mobile eXperience division saw revenue from smartphones rise 7% from a year ago, to 28.5 trillion won ($21.9 billion), despite a 21% decline from the previous quarter following the release of the Galaxy S25 range.

Samsung’s mobile unit delivered 3.1 trillion won ($2.4 billion) in operating profit, up 41% year-over-year, off the back of strong A-series and tablet sales, along with improved cost management.

The company’s display unit also delivered solid results, with Samsung Display Corp. posting 0.5 trillion won ($385 million) in profit on 6.4 trillion won ($4.9 billion) in sales, up 17% year-over-year. The growth was driven by small and medium-sized displays used in premium smartphones and rising demand in information technology and automotive segments.

Harman, Samsung’s automotive and audio division, reported its best quarter in a year with 0.5 trillion won ($385 million) in profit, up 67% year-over-year and from the last quarter. The growth was driven by Samsung ramping up its high-margin audio systems and optimizing costs.

For the second half of 2025, Samsung is positioning itself to capitalize on growing demand for AI infrastructure and next-generation devices.

With its semiconductor division, Samsung plans to expand sales of high-performance memory products, including 128-gigabyte DDR5 and 24-gigabyte GDDR7 for AI servers, while accelerating the transition to eighth-generation V-NAND across its SSD portfolio. Its foundry business will begin mass production of a two-nanometer mobile system-on-chip using GAA technology, with an emphasis on improving fab utilization and profitability.

Though it wasn’t mentioned in the earnings presentation, Samsung also signed a deal with Tesla Inc. on July 28 that will also boost its semiconductor division going forward. The deal includes a $16.5 billion contract for manufacturing advanced chips, likely using Samsung’s cutting-edge four- and three-nanometer processes, to support Tesla’s AI-powered autonomous driving systems and next-generation vehicle platforms.

In mobile and consumer electronics, Samsung expects solid momentum driven by new form-factor launches such as foldables, TriFold and XR devices. The company launched a number of new handsets on July 9, including its thinnest-ever foldable, which has so far been well received by reviewers.

Samsung Display is forecasting continued strength from premium smartphone and IT displays and plans to grow its QD-OLED monitor business, while the Harman unit is expected to sustain growth through seasonal audio demand and a rising share of automotive revenue.

Photo: Samsung