Samsung says tariff agreement reduces uncertainty, expects boost from Tesla deal

 Samsung Electronics (005930.KS), opens new tab said a trade deal between South Korea and Washington will help to alleviate business uncertainty, as the technology giant forecast more major chip orders after signing a $16.5 billion deal with Elon Musk's Tesla (TSLA.O), opens new tab. U.S. President Donald Trump said the U.S. will charge a 15% tariff on imports from South Korea as part of the deal that eases, for now, tension with a top-10 trading partner and key Asian ally. Imports from South Korea, a powerhouse exporter of computer chips, cars and steel, had faced a 25% rate. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. Advertisement · Scroll to continue The tariff deal comes days after Tesla said it had signed a deal to source chips from Samsung, a move that analysts said could help the tech giant's struggling contract business. "Building on this milestone, we anticipate securing additional orders from large customers," Samsung Vice President Noh Mi-jung said on an earnings call, referring to its struggling contract chipmaking business. Samsung's new U.S. semiconductor factory in Texas, which is expected to make chips for Tesla (TSLA.O), opens new tab, is on track to begin production in 2026, she said. "The key to the Tesla order is how much Samsung would be able to address production yield issues for its advanced 2 nanometer chips," said Greg Roh, head of research at Hyundai Motor Securities. Advertisement · Scroll to continue The Texas project is central to Samsung Chairman Jay Y. Lee's strategy of expanding beyond its bread-and-butter memory chip business into high-end contract chip manufacturing, which is dominated by Taiwan's TSMC (2330.TW), opens new tab. Noh's comments came after the company posted 4.7 trillion won ($3.37 billion) in operating profit for the April-June period, its weakest earnings in six quarters. That was roughly in line with an earlier estimate that had disappointed investors. The South Korean tech giant forecast a gradual second-half recovery for its overall business, without providing further details. Second-quarter operating profit at its chip division plunged 94% from a year earlier, it said, hurt by delays in supplying the latest AI chips to Nvidia (NVDA.O), opens new tab and U.S. export curbs on advanced semiconductor sales to China. A fragile truce between Cambodia and Thailand held for a second day on Wednesday, despite accusations of violations on both sides.  FOCUS ON AI CHIPS Prolonged weakness in Samsung's performance has deepened investor concerns over the South Korean company's ability to catch up with smaller rivals like SK Hynix (000660.KS), opens new tab in developing high-bandwidth memory (HBM) chips used in AI data centres and sold to customers including Nvidia. Last October, Samsung said it was making progress on a major deal to supply HBM3E chips to an unidentified customer that analysts said was Nvidia. Samsung on Tuesday did not give an update to the plan, while warning that the supply of HBM3E chips has been growing faster than demand, which would affect pricing. The tech giant said it has also provided samples of its next-generation HBM4 chips to customers, with a plan to supply them next year. Customers for this chip are also expected to include Nvidia, analysts said.