[Click eStock] "Samsung Electronics, 2Q Earnings Weak but Focus on Industry Improvement"

On the 20th, BNK Investment & Securities maintained its investment opinion of "Buy" on Samsung Electronics and kept the target price at 87,000 KRW.

BNK Investment & Securities revised Samsung Electronics' Q2 revenue down from 61.8 trillion KRW to 59.8 trillion KRW, and operating loss from 500 billion KRW to 820 billion KRW.

By business division, DS recorded -4.5 trillion KRW, SDC 800 billion KRW, DX 2.75 trillion KRW, and Harman 100 billion KRW. Despite a slight upward revision in DRAM performance, the deterioration in mobile demand continued into Q2, leading to system LSI and wireless segment results being worse than expected. Due to weak non-memory sales, the foundry segment is also expected to turn to a loss in Q2 following LSI. For smartphones, shipments decreased by 8% compared to the previous quarter, and the average selling price (ASP) fell by 15%, making it uncertain whether double-digit operating profit margins can be maintained.

[Image source=Yonhap News]

However, the main memory market has bottomed out, and with the display sector entering its peak season and expectations for new foldable phone models, performance is expected to improve. After inventory normalization, customers are increasing their inventory replenishment demand, and due to the AI investment boom, demand for high-capacity DRAM is rising. In the display sector, pre-production of new models for the second half began in June, and seasonal peak effects are expected in Q3. Although macro uncertainties persist, smartphone performance is also expected to improve in Q3 due to the launch of the new Z Fold phone 5 model.

Minhee Lee, a researcher at BNK Investment & Securities, said, "Although global set demand remains weak, we maintain a positive outlook as the main semiconductor and display markets have bottomed out," adding, "Quarterly performance improvements are expected from the second half, and the stock price will likely rebound after a temporary correction."

This content was produced with the assistance of AI translation services.