1. What Happened? Q2 Earnings Breakdown
HD Hyundai Construction Equipment reported Q2 2025 revenue of KRW 967.7 billion and operating profit of KRW 40 billion, exceeding market forecasts. However, net profit came in at a mere KRW 600 million, significantly below expectations. This suggests potential factors such as increased non-operating expenses or one-time losses.
2. Why These Results? Fundamental and Market Analysis
Looking at the first half of 2025, both revenue and operating profit declined compared to the same period last year by 45.4% and 57.0%, respectively. This can be attributed to the global economic slowdown and a weakened construction market. However, the Q2 results showed a recovery compared to Q1, offering a positive signal. The company’s high export ratio (89.7%) makes it vulnerable to exchange rate fluctuations.
3. What’s Next? Future Outlook
Positive factors include growth in the compact equipment market, strengthened eco-friendly management, and the merger with HD Hyundai Infracore. However, persistent global economic slowdown, intensified competition, and exchange rate volatility pose risks.
4. What Should Investors Do? Investment Strategies
In the short term, a conservative approach is advised until the reasons for the net profit shock are clarified and improvement is demonstrated. In the long term, investors can consider the potential synergies from the HD Hyundai Infracore merger and the company’s competitive edge in eco-friendly technology. However, continuous monitoring of exchange rate volatility and cost management capabilities is crucial.