Q2 2024 Samsung SDI Co Ltd Earnings Call Transcript
Key Points
- Samsung SDI Co Ltd (FRA:XSDG) maintained solid results by prioritizing profitability despite a challenging market environment.
- The company is on track with its preparation for commercializing all-solid-state batteries, expanding sample supply to five customers.
- Samsung SDI Co Ltd (FRA:XSDG) secured a large-scale ESS project from a leading clean energy company in the US, reflecting market recognition of its competitiveness.
- The electronic materials segment saw a revenue increase of 5% QoQ and 1% YoY, with operating profit rising 36% QoQ and 16% YoY.
- The company is actively preparing for mass production of LFP batteries in 2026 to capture expanding demand in the volume and entry-level EV markets.
- Q2 revenue was KRW4.5 trillion, down 13% quarter over quarter and 24% year over year, impacted by slowed market demand.
- The battery business posted a 15% QoQ and 27% YoY decline in revenue, with operating profit down 3% QoQ and 46% YoY.
- The EV battery segment fell short of market expectations due to sluggish demand, leading to a decline in sales and utilization rate.
- The company faces continued market demand slowdown in the EV battery sector, which derailed more than anticipated.
- Near-term EV demand remains weak, and changes have been detected in OEM's electrification strategies, requiring active market monitoring.
Welcome, everyone. Thank you for joining us today. I'm VP Yun Jae Kim of Samsung SDI's business management office. First, we are joined by CFO, Jong Seong Kim; EVP Michael Son, for automotive and ESS battery; EVP Han-Je Cho, representing small battery; and VP Kyungho Yoon for electronic materials.
We'll now begin the earnings call for the second quarter of 2024.
First, let me enumerate our Q2 results and financial highlights. Under the effect of slowed market demand incited by the EV adoption curve entering the chasm, Q2 revenue was KRW4.5 trillion, down 13% quarter over quarter and 24% year over year. Operating profit went up 5% on quarter to KRW280 billion but dipped 38% on year.
Speaking of performance by segment, the battery business posted KRW3.9 trillion in revenue, down 15% QoQ and 27% YoY, impacted by slowing market demand and falling metal prices. The operating profit declined 3% versus last quarter and 46% versus last year to KRW208 billion.
The electronic materials revenue was KRW577 billion, which increased
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