Samsung results spark declines across semiconductor sector
Micron Technology (NASDAQ:MU) shares fell 4.9% in premarket trading on Tuesday, extending a broader decline across the memory semiconductor industry after Samsung Electronics’ latest earnings update prompted selling throughout the sector. Shares of SanDisk also dropped 4.7% before the opening bell.
The weakness followed Samsung Electronics’ (KS:005930) preliminary second-quarter earnings announcement, which, despite delivering record profit growth, failed to boost investor sentiment and instead weighed on memory chip manufacturers globally.
Record earnings fail to support chip stocks
Samsung forecast operating profit of 89.4 trillion won (US$58.44 billion) for the April-to-June period, up from 4.7 trillion won a year earlier. The result exceeded the LSEG SmartEstimate of 87.3 trillion won, while revenue is expected to increase 129% year over year to 171 trillion won, according to the company’s regulatory filing.
Despite those stronger-than-expected figures, Samsung shares fell sharply, with fellow South Korean chipmaker SK Hynix also coming under heavy selling pressure.
Memory chip sector comes under pressure
The weakness in South Korean semiconductor stocks spilled over into US-listed chipmakers, with Micron among the companies affected by the broader market reaction.
Although Samsung’s earnings highlighted continued demand for memory chips driven by artificial intelligence applications, investors appeared to focus on elevated expectations for the sector after a prolonged rally.
Samsung, the world’s largest producer of memory chips, is expected to publish its full second-quarter results later this month, including detailed earnings across its individual business divisions.
Investors await further sector guidance
Micron’s decline reflects the wider pullback in memory semiconductor stocks as investors reassess valuations following Samsung’s earnings update.
Market participants will now look to Samsung’s full results for additional insight into demand trends across the global memory chip industry.