Yen Near 40-Year Low as USD/JPY Approaches Key 162 Level, Raising Intervention Concerns 
Oil Prices Slip as Iran Sanctions Relief and Hormuz Shipping Recovery Ease Supply Concerns 
Oil Prices Drop as Strait of Hormuz Shipping Recovers 
New Zealand Fast-Tracks Gold Mining as Industry Revival Gains Momentum 
Asian Stocks Slip as Oil Rebounds Amid Fed Rate Hike Fears 
U.S. Dollar Reaches One-Year High as Tech Sell-Off and Fed Rate Hike Expectations Support Demand 
Japan Keeps Markets Guessing as Yen Nears 40-Year Low, Raising Intervention Risks 
Singapore Inflation Stays Muted in May as Core CPI Misses Forecasts Ahead of MAS Review 
South Korea Stocks Tumble as AI-Fueled Rally Faces Profit-Taking Pressure 
China Keeps Loan Prime Rates Unchanged for 13th Straight Month as Policymakers Prioritize Credit Demand Recovery 
Wall Street Ends Mixed as Alphabet Slumps, Middle East Developments and Fed Outlook Weigh on Markets 
US Dollar Hits One-Year High as Hawkish Fed Outlook Overshadows Middle East Developments 
Dollar Holds Firm as U.S.-Iran Talks Ease Tensions, GBP/USD Slips Amid UK Political Uncertainty 
Asian Stocks Slide as AI Rally Pauses, South Korean Chipmakers Lead Regional Decline 
Japan, U.S. Discuss Yen Weakness as Currency Intervention Concerns Grow 
Samsung Electronics is projected to report a four-fold increase in Q3 operating profit due to recovering chip demand. However, the company’s slow move into the booming AI chip market may impact its future growth trajectory.
Q3 2024 Profit Surge Amid Chip Demand Recovery
Analysts estimate Samsung's operating profit at around 10.33 trillion won ($7.67 billion) for Q3, significantly higher than 2.43 trillion won a year earlier. However, this is relatively unchanged from 10.44 trillion won in the previous quarter, indicating a slowing recovery pace. The global semiconductor market has improved, primarily driven by demand for AI server chips, yet demand for traditional chips used in smartphones and PCs is softening.
Lagging in the AI Chip Market & Competitive Pressure
Samsung faces challenges catching up to competitors like SK Hynix and Micron in the high-margin AI chip sector, supplying major players like Nvidia. Additionally, Samsung is competing against growing Chinese semiconductor companies for commodity chip production. Analysts predict the company’s chip division will swing to a profit of 5.5 trillion won year-on-year but will see a 15% drop from the previous quarter, partly due to bonus provisions.
Geopolitical Risks & Market Shifts
Samsung's slower response to the AI chip market and its dependence on traditional mobile chips and China make it susceptible to geopolitical risks. Analyst Daniel Kim of Macquarie Equity Research noted that a potential commodity DRAM supply glut may impact Samsung more severely than its rivals like SK Hynix.
Mobile Business & Share Performance
Sales of Samsung's premium foldable phones have underperformed, contributing to a 2.6 trillion won operating profit in its mobile and network division—a 20% decrease from last year. Meanwhile, Samsung shares have declined by 23% this year, trailing SK Hynix’s 23% gain.
Upcoming Earnings Announcement
Samsung Electronics is set to release its preliminary Q3 results on Tuesday, with full financial details to be reported later in the month.
($1 = 1,336.39 won)
