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 an operating loss of KRW 398 billion and net loss of KRW 167 billion; H1 2025 revenue was KRW 6,356.2 billion, down 28.6% YoY, with an operating loss of KRW 831.9 billion.

• Losses were driven by weak EV battery demand, delayed volume compensation, increased fixed costs, and tariff impacts, though small battery and electronic materials segments improved.

• Management expects gradual earnings recovery in H2, targeting a return to profit in Q4, led by small battery and electronic materials growth.

• Major strategic actions included a capital increase, divestiture of the polarizer film business, and new joint ventures in the US.

Financial highlights

• Q2 operating loss: KRW 398 billion; pre-tax loss: KRW 341 billion; net loss: KRW 167 billion; H1 operating loss: KRW 831.9 billion; net loss attributable to owners: KRW 373.1 billion.

• Gross margin improved to 8.8% in Q2 2025 from 6.4% in Q1 2025, but remains below 22.6% in Q2 2024; H1 gross margin was 7.6%.

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

• Cash and cash equivalents increased to KRW 2,154 billion at Q2 2025 period end.

• Q2 CapEx was KRW 1.1 trillion, totaling KRW 1.8 trillion for H1.

Outlook and guidance

• Gradual improvement in earnings expected in H2, with a turnaround to profit targeted for Q4, led by small battery and electronic materials growth.

• No cash dividends planned for 2025–2027 due to negative free cash flow and ongoing investment.

• Management expects continued investment in battery capacity and R&D, with a focus on long-term growth in EV and ESS markets.

• Persistent macroeconomic uncertainties, regulatory risks, and U.S. tariffs may continue to pressure profitability.

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