As third-quarter earnings announcements by major domestic corporations get into full swing, fortunes are diverging by sector. Semiconductors and shipbuilding are showing notable improvement in results, while automobiles, batteries, and petrochemicals face growing concerns over weakening profitability.
Earlier, Samsung Electronics, which serves as a "barometer of earnings" for domestic corporations, posted operating profit that beat market expectations on the back of a rebound in DRAM prices and rising demand for high-bandwidth memory (HBM).
SK hynix is likely to surpass 1 trillion won in third-quarter operating profit for the first time ever. According to the securities-market consensus (average estimate), revenue is 24.7 trillion won and operating profit is 11.6 trillion won.
The shipbuilding industry improved results as deliveries of high value-added vessels increased. On the 23rd, Samsung Heavy Industries, which released results, recorded third-quarter operating profit of 238.1 billion won, up 99% from a year earlier. The combined operating profit of the shipbuilding "big three" (HD Korea Shipbuilding & Offshore Engineering, Hanwha Ocean, Samsung Heavy Industries) is expected to reach 1.5 trillion won.
There is also optimism for related stocks that momentum could build if the MASGA ("Make American Shipbuilding Great Again") project takes concrete shape on the occasion of the Asia-Pacific Economic Cooperation (APEC) summit to be held in Gyeongju, North Gyeongsang, at the end of this month.
By contrast, the automobile industry is expected to suffer a sharp retreat in profitability due to the fallout from U.S. tariff burdens. Hyundai Motor's operating profit is estimated at 2.45 trillion won, down 31.5% from a year earlier, and Kia's at around 2 trillion won, down 29.6%. As tariff talks between Korea and the United States have struggled, the existing 25% tariff remaining in place has had a major impact.
The shock related to slowing electric-vehicle demand has also affected the battery industry. Samsung SDI is expected to post a deficit in the mid-350 billion won range, and SK On is forecast to record a deficit in the mid-100 billion won range. LG Energy Solution, the only one of the three battery makers to have released preliminary results, held up well with operating profit of 601.3 billion won thanks to strong performance in its energy storage system (ESS) business.
The refining industry is expected to swing to a profit in the third quarter on improved refining margins and higher oil prices. SK Innovation and S-Oil are projected to post operating profits of 367.8 billion won and 232.9 billion won, respectively, and unlisted GS Caltex and HD Hyundai Oilbank are also expected to have recorded profits. This month, refining margins rose to $13–$14 per barrel, more than doubling from the early-year low, which proved decisive.
The petrochemical sector remains sluggish. With a strong won-dollar exchange rate, weak domestic demand, and delayed restructuring overlapping, LOTTE Chemical is expected to post an operating loss of 134.8 billion won and Hanwha Solutions 159.6 billion won. LG CHEM's estimated third-quarter operating profit is 638.5 billion won, but the impact of its battery subsidiary LG Energy Solution is significant, and profits from the core petrochemical business are expected to be weak.
Choi Jae-won, a researcher at Kiwoom Securities, said, "What is driving the recent steep improvement in results is largely the upward revisions to earnings forecasts in the semiconductor sector," adding, "Other sectors are seeing slight downward adjustments."
Choi added, "Because earnings momentum (upside potential) is appearing in a differentiated way by sector, there is a need to take a focused approach centered on corporations with high expectations for an 'earnings surprise' (better-than-expected results)."