Samsung SDI (006400) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue was KRW 3.2 trillion, up 5.1% sequentially but down 22% year-over-year, with a net loss of KRW 167 billion due to weak demand and external headwinds.

• Operating income was a loss of KRW 398 billion in Q2 2025, following a loss of KRW 434 billion in Q1 2025.

• Battery business revenue was KRW 2.96 trillion, down 1% sequentially and 24% year-over-year, with an operating loss of KRW 431 billion; small battery losses narrowed, and electronic materials saw improved sales and profitability.

• Management expects gradual earnings improvement in the second half, targeting a return to profit in Q4, driven by recovery in small battery and electronic materials segments.

• Net income margin was -5.2% in Q2 2025, compared to 6.5% in Q2 2024.

Financial highlights

• Q2 operating income was a loss of KRW 398 billion; pre-tax loss was KRW 341 billion.

• Gross margin improved to 8.8% in Q2 2025 from 6.4% in Q1 2025, but remains well below 22.6% in Q2 2024.

• EBITDA rose to KRW 114 billion in Q2 2025, up 71.8% sequentially, but down 83.7% year-over-year.

• Assets increased to KRW 41.4 trillion, up KRW 727 billion from Q1, and equity rose to KRW 22.7 trillion, up KRW 1.1 trillion, both due to capital increases.

• Q2 CapEx was KRW 1.1 trillion, with a first-half cumulative total of KRW 1.8 trillion.

Outlook and guidance

• Gradual sales and earnings recovery expected in H2, with a Q4 profit turnaround anticipated, especially in small battery and electronic materials.

• US EV demand faces uncertainty due to regulatory changes and tariffs, while EU demand may rise with revived subsidies.

• Strategies include efficient line operation, expanding orders in entry segments, and launching new battery products.

• Mid to large battery losses expected to narrow due to increased shipments and compensation for delayed EV battery orders; U.S. tariffs remain a profitability risk.

• Electronic materials to see sales and profit growth, but macro uncertainties may cause earnings volatility.