An aerial view of Samsung SDI's Giheung campus [Samsung SDI]
An aerial view of Samsung SDI's Giheung campus [Samsung SDI]

Samsung SDI delivered an earnings surprise in the second quarter, swinging to profit when the market had expected a modest loss. The company posted operating profit of more than 200 billion won ($138 million), returning to the black for the first time in seven quarters.

Samsung SDI disclosed Thursday that its consolidated second-quarter sales reached 3.77 trillion won and operating profit came in at 203.8 billion won. Sales rose 18.5 percent from a year earlier and 5.4 percent from the previous quarter. The operating profit marked the company's first positive result since the third quarter of 2024.

The results far exceeded market expectations. According to FnGuide, the average consensus among brokerages over the past month had projected second-quarter sales of 3.66 trillion won and an operating loss of 2.6 billion won. Some brokerages had forecast an operating loss of as much as 109 billion won. Actual sales beat the consensus by 107.5 billion won, and the operating result came in 206.4 billion won better than expected.

Even the most optimistic brokerage forecast had put operating profit at 95 billion won — a figure Samsung SDI more than doubled.

Net profit for the period came in at 471.6 billion won, more than four times the market consensus of 111.2 billion won. That represented a 740.5 percent increase from the previous quarter and a swing to profit compared with the same period last year.

After posting an operating loss of 155.6 billion won in the first quarter, Samsung SDI's strong second-quarter showing pushed its cumulative first-half operating profit to 48.2 billion won — effectively achieving the full-year turnaround that had originally been expected only in the second half.

The battery division led the recovery. Battery segment sales reached 3.52 trillion won, up 18.8 percent from a year earlier, while operating profit of 159.3 billion won marked a return to the black.

Expanding investment in AI data centers drove higher sales of high-output batteries used in uninterruptible power supply (UPS) units and battery backup units (BBU). Sales of batteries for power tools and European electric vehicles also increased.

Profitability improved sharply as higher sales of premium products and tariff refund effects combined with 107.7 billion won in benefits from the US Advanced Manufacturing Production Credit (AMPC). Even excluding the AMPC benefit, second-quarter operating profit reached 96.1 billion won — approaching 100 billion won — signaling a genuine recovery in the core business driven by stronger sales of high-output batteries and European EV batteries.

The electronic materials division also performed well. Sales rose 14.5 percent year-on-year to 249.8 billion won, while operating profit climbed 34.8 percent to 44.5 billion won. Solid semiconductor materials sales were complemented by improved revenue and margins for film materials used in foldable smartphones.

In the first half, Samsung SDI signed long-term supply agreements with major US ESS customers and secured orders in South Korea's next-generation power distribution ESS projects. The company also won a new project with Mercedes-Benz, completing a sweep of all three major German premium automakers — BMW and Audi are already customers.

In the second half, the company plans to expand production capacity for UPS and BBU batteries to meet AI data center demand. In the United States, it will pursue mass production of prismatic lithium iron phosphate (LFP) batteries and build out a local supply chain.

Over the medium to long term, Samsung SDI is also developing UPS and grid-scale ESS products using sodium-ion batteries, which offer advantages in longevity and safety. For EV batteries, the company plans to expand supply to mainstream European models and pursue new project wins including LFP batteries.

"We had originally expected a turnaround in the second half of this year, but the timing was brought forward as sales growth and profitability improvement accelerated," a Samsung SDI official said. "We will continue to pursue sustainable top-line growth and secure profitability."


kwater@heraldcorp.com