Samsung Electronics saw operating profit for its chip division fall by 94 percent year-over-year for the quarter ending June 30.

The company’s Device Solutions (DS) division, which includes its memory chip, semiconductor design, and foundry business units, posted an operating profit of 400 billion won ($308 million) for Q2 2025, down from 6.45 trillion won ($4.6 billion) for the same quarter in 2024.

The only bright spot for the DS division emerged from the company’s memory chip business, which posted revenue of 21.2 trillion won ($16.3 billion) for the quarter, up 11 percent quarter-over-quarter (QoQ), but down three percent year-over-year (YoY). Revenue for the business unit overall fell by two percent YoY from 28.6 trillion won ($20.5bn) to 27.9 trillion won ($20bn), but was up 11 percent QoQ.

Samsung attributed the growth in its memory business to increased demand for HBM3E and DDR5 products, in addition to the resumption of data center projects that had previously been delayed, which it said had led to an increase in the sale of server SSDs.

However, in a statement, the company said that although the DS division reported revenue growth as a result of increased sales of memory products, “earnings for the Foundry Business remained weak due to the impact of inventory value adjustments that stemmed from US export restrictions on advanced AI chips to China, as well as a continued low utilization rates at mature nodes.”

Yesterday (July 30), President Trump announced he would be placing a 15 percent tariff on imports from South Korea.

Samsung’s company-wide operating profit for the quarter was down 55 percent YoY and 30 percent QoQ to 5.02 trillion won ($3.6 billion). Consolidated revenue for the three-month period was 74.6 trillion won ($57.4 billion), up one percent YoY but down six percent from the previous quarter.

The company’s mobile division, display unit, and automotive and audio businesses all saw profit increases for the quarter.

Earlier this week, Tesla CEO Elon Musk confirmed that the automotive company had signed an eight-year $16.5bn deal with Samsung to manufacture its forthcoming AI6 chips at Samsung’s fab in Taylor, Texas.

Taking to his social media platform X, Musk said the strategic importance of the deal is hard to overstate, adding: “The $16.5bn number is just the bare minimum. Actual output is likely to be several times higher.”

Samsung is also the manufacturer of Tesla’s AI4 chip, although production of the AI5 will be undertaken by TSMC at its fab in Arizona, Musk said.

"Building on this milestone, we anticipate securing additional orders from large customers," Samsung VP Noh Mi-jung said on the company’s earnings call after the results were published.