Samsung SDI Faces EV Headwinds but Finds Strength in Energy Storage

Samsung SDI (KRX: 006400), the battery and electronic materials arm of Samsung Electronics (KRX: 005930), endured a difficult 2024, with revenue tumbling -24% year-on-year and operating income declining –78%. The downturn was driven by higher interest rates and reduced consumer subsidies, which curbed demand for electric vehicles (EVs). The company’s EV battery segment struggled, while the energy storage system (ESS) business emerged as a bright spot, buoyed by rising demand from artificial intelligence-powered data centers in the U.S.
The near-term outlook remains challenging. Visible Alpha consensus estimates show a -8% revenue decline in 2025, with sales from its core lithium-ion battery (LiB) business—accounting for over 90% of total revenue—expected to drop -9%. The weakness stems from a -23% slump in small-sized batteries and a -13% decline in mid-to-large EV batteries. Meanwhile, the ESS segment continues to shine, with mid-to-large-sized ESS storage batteries projected to grow +22% in 2025.

Samsung SDI’s electronic materials division is also under pressure. After a steep -44% revenue decline in 2024, sales are expected to fall another -25% this year. Despite this, operating income is expected to rise 25% this year, and analysts anticipate a broader recovery across the company’s key segments from 2026 onwards.