Samsung Announces Q3 Results Below Expectations

Samsung announced preliminary Q3 results that will be below market expectations. The company also issued a surprising apology for delays in shipping new memory chips to support AI applications.

The smartphone giant forecasts that Q3's operating profit will jump nearly fourfold year-on-year to KRW9.1 trillion ($6.7 billion) and revenue 17.2% to KRW79 trillion. It will release net profit and sales by division on 31 October. In Q2, Samsung’s net profit increased more than fivefold to KRW9.8 trillion and revenue 23.5% to KRW74.1 trillion, led by its chip business, which grew 94% to KRW28.6 trillion.

Head of the memory business Jun Young-hyun stated these are testing times for Samsung as it faces rising competition from local rival SK Hynix and chipmakers in China, and cautioned of adjustments in inventory by some customers. Jun was named president of the Device Solution Business in May and noted in a statement to investors and customers that the company’s disappointing performance caused concerns about the fundamental technological competitiveness and the future of the company. He vowed to reorganize the division, with a focus on culture and processes.

In March, Samsung reportedly opted to shift to a new type of advanced machinery to increase the yield of its high bandwidth memory (HBM) chips. Volume production using a mass reflow molded underfill technique first used by SK Hynix will not begin until 2025 at the earliest.