Samsung Electronics posted a slight operating profit rise to 6.6 trillion won ($4.5 billion) in the first quarter, up 1.7% from the previous quarter, even as the company faces mounting pressure from new U.S. tariffs. Some analysts believe the better-than-expected performance was partly driven by customers rushing to secure chips and smartphones before U.S. trade restrictions take effect.
The South Korean tech giant reported a 4.2% quarterly revenue increase to 79 trillion won, representing a robust 9.8% jump year-on-year, according to its earnings guidance. Full financial details will be disclosed later this month.
The looming trade conflict poses significant challenges for Samsung, which operates major production facilities in Vietnam that account for approximately 45% of its global smartphone output. President Trump announced a 46% tariff on Vietnamese imports starting Wednesday, potentially forcing price hikes or margin compression for Galaxy smartphones shipped to the U.S.
Semiconductors were initially excluded from the reciprocal tariffs, but Trump has indicated that duties on chip imports – previously exempt – will be imposed later. This would impact Samsung’s semiconductor business, which ships significant volumes from South Korea, now subject to a 25% tariff.
South Korean Trade Minister Cheong In-kyo is meeting with U.S. Trade Representative Jamieson Greer in Washington this week to negotiate tariff reductions for Samsung and other Korean companies. Citi estimates the new tariffs could reduce South Korea’s GDP by 0.16% this year.
