POSCO Holdings reported another disappointing quarter as its troubled battery materials division continued bleeding money, overshadowing modest improvements in the steel giant’s core business.
The South Korean company posted operating profit of ₩607 billion ($437 million) for the second quarter, down from ₩752 billion in the previous quarter and marking another decline in what has been a challenging year for the conglomerate.
Net profit plunged 85% from a year earlier to ₩84 billion, missing analyst expectations of ₩350 billion, as the company grappled with weak steel demand and mounting losses from its battery materials venture. Revenue slipped to ₩17.6 trillion ($12.6 billion) from ₩18.5 trillion in the first quarter.
The battery materials unit, operated through POSCO Future M, recorded an operating loss of ₩144 billion ($104 million) during the quarter, extending a streak of losses that has raised questions about the company’s strategy. The unit’s utilization rate has plummeted below 30%, with daily lows of just 10%, as it struggles to compete with lower-cost Chinese producers.
Steel sales dropped amid President Trump’s decision to double duties on foreign steel and aluminum to 50% in early June, adding pressure to POSCO’s traditional business. The company has been forced to consider tactical changes to its investment timeline as market conditions deteriorate.
POSCO Holdings plans to sell more than 97% of 120 non-core assets by 2026 to raise ₩2.6 trillion for restructuring, signaling the depth of changes needed to restore profitability. The company has already scaled back its battery materials revenue target to ₩11 trillion by 2026, down from an earlier goal of ₩16 trillion by 2025.
