Samsung Electronics on Tuesday projected a far worse than expected 56% plunge in second-quarter operating profit due to weak AI chip sales, deepening investor concerns over the tech giant's ability to revive its struggling semiconductor business.

In the June quarter, the company’s operating profit dropped by a sharper-than-expected 56 per cent, largely due to inventory write downs triggered by U.S. export restrictions on AI chips destined for China.

Samsung Electronics reports a 56% drop in operating income for Q2, marking its first profit decline since 2023 due to challenges in the memory chip market.