Samsung Electronics saw its stock price fall 6.92% to close at 296,000 won despite announcing provisional Q2 operating profit of 89.4 trillion won, representing a 1810% year-over-year increase and exceeding market consensus of 75-84 trillion won. The decline was driven by strong profit-taking, with foreign investors selling 1.8207 trillion won worth of shares on the announcement day, accounting for over half of total foreign net selling in the KOSPI market. The sharp drop in Samsung Electronics, which represents 27.61% of the KOSPI market capitalization, triggered a sell-side sidecar and first-stage circuit breaker in the broader market.
Samsung Electronics Stock Falls 6.92% on Record Earnings Day
Samsung Electronics closed at 296,000 won, down 22,000 won (6.92%) from the previous trading day, according to the Korea Exchange. The stock fell as low as 286,000 won during intraday trading. Foreign investors led the selling, disposing of 1.8207 trillion won worth of Samsung Electronics shares, making it the top foreign net-sold stock for the day. This represented more than half of the 2.93 trillion won in total foreign net selling across the KOSPI market.
Samsung Electronics Reports 89.4 Trillion Won Q2 Operating Profit
Samsung Electronics announced provisional Q2 operating profit of 89.4 trillion won, up 1810% year-over-year and 57.2% quarter-over-quarter. The figure significantly exceeded market consensus estimates of 75-84 trillion won. Securities analysts estimated that the announced figure does not reflect approximately 19 trillion won in special management performance bonus provisions, suggesting actual operating profit approached 110 trillion won.
Analysts Attribute Decline to Profit-Taking Pattern
Bloomberg noted that Samsung Electronics has recorded 16 earnings surprises since 2019 in quarterly earnings announcements, but the stock price declined on the announcement day in 10 of those instances. Securities industry analysts characterized the stock weakness as a typical "buy on rumor, sell on news" phenomenon, indicating profit-taking after the stock price had already reflected expectations ahead of the announcement. Some market participants cited concerns about semiconductor peak-out, referencing a Morgan Stanley report from the previous day stating that "the narrow rally centered on semiconductors is concluding and the market is entering a phase where leadership is gradually broadening."
Analysts Maintain Buy Recommendations Citing Low Valuation
Han Dong-hee, a researcher at SK Securities, calculated that Samsung Electronics' 12-month forward P/E ratio fell to 5.3x based on the closing price, compared to 5.6x for SK Hynix and 6.8x for Micron. Goldman Sachs stated that the KOSPI's 12-month forward P/E ratio plunged to 6.65x, the lowest since the global financial crisis, and noted that "even if we assume the worst and downgrade Korean corporate earnings forecasts by 33%, the current level has significant upside potential." Mirae Asset Securities slightly raised Samsung Electronics' 2026 operating profit estimate to 397 trillion won (up 811% year-over-year) and 2027 estimate to 576 trillion won (up 45% year-over-year). Daishin Securities estimated 2026 operating profit at 387 trillion won and 2027 at 563 trillion won. Bloomberg projected Samsung Electronics' 2026 operating profit at $237.7 billion (approximately 362.6 trillion won), approaching NVIDIA's estimated operating profit of $247 billion (approximately 376.46 trillion won).
FAQ
What was Samsung Electronics' Q2 operating profit?
Samsung Electronics announced provisional Q2 operating profit of 89.4 trillion won, representing a 1810% increase year-over-year and a 57.2% increase quarter-over-quarter, exceeding market consensus of 75-84 trillion won.
Why did Samsung Electronics stock fall despite record earnings?
The stock fell 6.92% to 296,000 won due to profit-taking by investors, particularly foreign investors who sold 1.8207 trillion won worth of shares. Bloomberg noted that Samsung Electronics' stock has declined on the announcement day in 10 out of 16 earnings surprises since 2019, reflecting a "buy on rumor, sell on news" pattern.
What is Samsung Electronics' current valuation according to analysts?
SK Securities calculated Samsung Electronics' 12-month forward P/E ratio at 5.3x based on the closing price, compared to 5.6x for SK Hynix and 6.8x for Micron. Goldman Sachs noted that the KOSPI's 12-month forward P/E ratio fell to 6.65x, the lowest since the global financial crisis.
