1. What Happened at Seojin System?

Seojin System’s Q2 2025 financial results revealed a significant downturn, with revenue at ₩258.5 billion (-22.2% YoY), operating income at -₩5.9 billion (loss), and net income at -₩81.2 billion (loss). These figures significantly missed market expectations.

2. Why the Underperformance?

The primary driver was the underperformance of the ESS business segment due to increased global competition, fluctuating customer investments, and supply chain issues. The electric vehicle, semiconductor, and telecommunications equipment segments also experienced revenue declines. Furthermore, increasing debt, financial losses, and exchange rate volatility exacerbated the situation.

3. What’s the Outlook?

The short-term outlook remains challenging, given the persistent macroeconomic uncertainties such as the global economic slowdown and high interest rates. However, there are potential positive factors, including the long-term growth potential of the ESS market and the new container box business venture.

4. What Should Investors Do?

The current investment recommendation is ‘Hold’ or ‘Sell’. The likelihood of short-term performance improvement is low, and the company faces significant financial burdens. Investors should carefully monitor the recovery of the ESS business, the success of new ventures, and efforts to improve the financial structure.