Samsung SDI posts earnings surprise, returns to profit after 7 quarters

Samsung SDI’s Giheung District headquarters in Yongin, Gyeonggi Province / Courtesy of Samsung SDI

Samsung SDI delivered a major earnings surprise in the second quarter, returning to operating profit for the first time in seven quarters as surging demand for artificial intelligence (AI) data center batteries drove a faster-than-expected turnaround.

LG Energy Solution also swung to an operating profit in the second quarter, underscoring the growing importance of energy storage systems (ESS) as rising power demand and massive investment in AI infrastructure offset sluggish demand for electric vehicles (EVs).

Samsung SDI said Thursday that it posted an operating profit of 203.8 billion won ($140 million) in the April-June period, reversing an operating loss of 290.2 billion won a year earlier. The result significantly exceeded market expectations, with analysts predicting the company would remain in the red until the second half of the year.

Revenue rose 18.5 percent year-on-year to 3.77 trillion won, while net profit reached 471.6 billion won, up 740.5 percent from the previous quarter. Its cumulative operating profit reached 48.2 billion won in the first half, putting the company ahead of its turnaround schedule.

The battery business drove the recovery, with revenue rising 18.8 percent to 3.52 trillion won and operating profit reaching 159.3 billion won. Sales of high-power batteries for uninterruptible power supply systems, battery backup units, power tools and EVs in Europe increased, while profitability improved on higher sales of high-value products, U.S. production incentives and tariff refunds.

Samsung SDI said strong demand for AI data center applications was a key driver of its first-half recovery, particularly for batteries used in utility-scale ESS, uninterruptible power supply and battery backup unit systems. The company has secured long-term supply agreements with major U.S. ESS customers and won orders for next-generation distribution-grid ESS projects in Korea.

Ultium Cells' battery plant in Spring Hill, Tenn. Korea Times photo by Kwon Kyung-sung

LG Energy Solution posted an operating profit of 113.3 billion won, reversing an operating loss in the previous quarter. Revenue rose 15.3 percent quarter-on-quarter to 7.6 trillion won, including 241 billion won in North American production incentives.

LG attributed the improvement to increased ESS shipments following capacity expansion in North America, along with stronger sales of cylindrical EV cells and improved utilization rates at its European facilities.

For the first half, LG Energy Solution posted revenue of 14.1 trillion won, up 10.5 percent from a year earlier, with ESS accounting for nearly 30 percent of total revenue. ESS revenue surged 4.6 times year-on-year, while the company secured more than 3 trillion won in new orders.

Both companies expect ESS demand to remain strong as power consumption rises and investment in AI infrastructure accelerates. Samsung SDI plans to expand its U.S. supply chain and prepare for mass production of prismatic LFP batteries, while LG Energy Solution aims to strengthen its ESS lineup and provide end-to-end solutions spanning cells, systems and software.

The two companies are also developing next-generation batteries, including sodium-ion and all-solid-state technologies, as they seek to diversify beyond the slowing EV market.

SK On recorded an operating profit of 821.8 billion won during the same period, its first quarterly operating profit in seven quarters, while revenue reached 2.946 trillion won.

The battery affiliate of SK Innovation said the improvement was driven by one-off customer compensation payments, cost reductions, higher sales in Asia and increased tax credits under the U.S. Inflation Reduction Act (IRA).

Last year, the company ended its three-year joint operation of BlueOval SK with Ford Motor to restructure the U.S. battery manufacturing venture.