Samsung Electronics is facing a tough first quarter in 2025, with a projected 21% profit decline, driven by weak AI chip sales and losses in its contract chip manufacturing division. The global memory chip leader is struggling to keep pace with rival SK Hynix, particularly in the high-performance AI chip race, as it grapples with slumping profitability.

The company is increasingly relying on the Chinese market, where demand for less advanced products has provided some relief from U.S. export restrictions. However, analysts predict a dip in AI chip demand from Chinese clients this quarter.

Despite efforts to revamp its chip offerings, including a new version of its advanced HBM chips, Samsung’s profitability remains vulnerable to volatile memory chip prices, with DRAM and NAND flash costs both falling sharply. As Samsung navigates these challenges, the ongoing management change following the sudden passing of co-CEO Han Jong-Hee adds to the uncertainty surrounding its future performance.

Expect Samsung to report operational profits of 5.2 trillion won ($3.62 billion), down from 6.6 trillion won a year ago, while continuing to face pressure from both commodity chip price fluctuations and rising tariffs.

Read Full Article :- Samsung Forecasts 21% Profit Plunge Amid Sluggish AI Chip Demand