The South Korean electronics major, the world’s largest memory chip maker, said on Tuesday that rising trade barriers and tightening restrictions on AI chip exports to China—Samsung’s largest market—are casting a shadow over future demand for its chips and smartphone components.
“Demand uncertainty will increase in the second half due to recent changes in tariff policies in major countries and tightening export controls for AI chips,” said Kim Jae-joon, vice president of Samsung’s memory division, during an earnings call.
The company posted a 6.7 trillion won ($4.68 billion) operating profit for the first quarter ending in March, a modest 1.2% rise year-on-year, largely in line with expectations. This uptick was driven by a short-term boost in smartphone and chip sales as buyers rushed orders ahead of potential tariff hikes.
However, Samsung struck a cautious tone for the remainder of the year. It expects further uncertainty in its semiconductor business and a slowdown in smartphone shipments, particularly in the second quarter. The company noted that while AI servers and proactive buying amid tariff concerns may buoy chip demand short-term, these early purchases could suppress demand later in the year.
The warning comes amid broader industry jitters, with U.S. tariffs impacting global supply chains and prompting companies like General Motors to withdraw financial forecasts.
