The Samsung unit behind its Galaxy phones just reported its first quarterly loss ever

Thanks to higher chip prices, Samsung's Mobile eXperience unit has its first-ever quarterly loss

The semiconductor unit reported Q2 profits of 89.2 trillion won ($61.7 billion USD) compared to 4.68 trillion won ($3.25 billion USD) during the same quarter the previous year. The huge improvement in this unit would seem to be a massive positive for the company. 

However, the higher memory prices forced Samsung's Mobile eXperience (MX) division, the unit that designs and manufactures Samsung's Galaxy phones, tablets, smartwatches, and other mobile-connected products, to report an operating loss of 700 billion Korean won ($485 million to $518 million USD).

This was the first quarterly loss ever reported by the Mobile eXperience unit. It comes right after the company unveiled its three new foldable phones for 2026. Those models are the Samsung Galaxy Z Fold 8, the Galaxy Z Fold 8 Ultra, and the Galaxy Z Flip 8.

Josh Gilbert, an analyst at eToro, said, "The chips enriching one side of Samsung ​are now hurting the other, leaving the group more exposed than ever to memory pricing ​and the durability ⁠of hyperscaler demand." During the second quarter, Samsung reported revenue of 171.5 trillion won ($118.77 billion USD), slightly short of estimates calling for Q2 gross of 172.65 trillion won. Operating profits of 89.5 trillion won ($62.01 billion USD) topped forecasts calling for Sammy to report 88.13 trillion won in operating profits. 

The record operating profit was up 1,814% year-over-year while revenue was up 130%. Compared to the first quarter of 2026, the second quarter saw profit and revenue rise 56% and 28%, respectively. During the quarter, Samsung increased sales of its sixth-generation HBM4 High-Bandwidth Memory, used to power advanced AI processors. The DS semiconductor unit was responsible for 74.3% of Samsung's top line during Q2.

Memory chip shortage to continue as Samsung signs big deals with AI data center firms

The memory chip shortage is expected to continue, according to Jaejune Kim, executive vice president of Samsung's memory business. The executive also said that Samsung has signed long-term supply agreements with the top five data center firms and is working to secure a second supply agreement with another five large companies.

Samsung has a plan to turn around its beleaguered foundry business

Samsung said that it has a plan to turn the foundry around "in the near future." For the last few years, the foundry was having problems with its yield, which caused it to lose business from big companies such as Qualcomm. Samsung is aiming to grow the Foundry's revenue by double digits as it pushes for demand to rise in the US and China.

The company reported that its earnings per share soared 1,372% during Q2

For the second quarter, Samsung had 171.5 trillion won in revenue, more than doubling the 74.6 trillion won gross from the same quarter a year ago. Net profit soared from 5.1 trillion won to 71.6 trillion won. Earnings per share for the second quarter came to 10,849 won per share, a whopping 1,372% increase from the 737 won per share reported for the second quarter of 2025.

Ironically, later today Samsung rival Apple will be reporting its fiscal third quarter results shortly after the US markets close. As usual, we will be providing you with all of the important numbers and news from the report along with the reaction on Wall Street.

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