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 forecast its earnings to fall significantly short of market expectations in the second quarter this year, dragged down by weak semiconductor