--- title: "Korea" canonical: "https://anchor.is/the-hysteresis/issue/10/korea" publication: "The Hysteresis" publisher: "The Hysteresis" language: "en-US" guide: "https://anchor.is/the-hysteresis/llms.txt" permalink: "https://anchor.is/the-hysteresis/issue/10/korea" issue: 10 section: "korea" description: "LG, Samsung, SK — beyond the headlines" authors: ["Ronan Adike","Elise Huan-Cartwright"] published: 2026-08-17 updated: 2026-08-15 articles: 15 --- # The Hysteresis > The Hysteresis exists to give a small cross-functional team — strategy, investment, and procurement — a shared weekly instrument for reading the battery supply chain earlier than consensus. Success means the team consistently identifies inflection points in cell pricing, supplier health, and policy enforcement weeks or months before they surface in earnings calls, annual surveys, or trade press. The commercial mechanism is internal-first: the publication proves itself as a decision tool inside the organization, then extends to paid subscribers and a practitioner community as upside. Revenue follows utility — if the team makes better-timed procurement calls and competitive assessments because of what they read here, the publication earned its place. [Read on the website]() ## Issue 10 — Korea LG, Samsung, SK — beyond the headlines ### Q2 Scorecard All three Korean battery makers reported positive operating profit in Q2 2026. For Samsung SDI and SK On, it was the first positive quarter in seven. Read at the headline level, this looks like a synchronized inflection. The decomposition says otherwise. LGES remains loss-making before 45X credits, though the loss narrowed materially. Samsung SDI's profit includes an unquantified tariff refund. SK On's record result bundles customer compensation, AMPC, and JV restructuring savings into a single figure with no public breakdown. Meanwhile, balance sheets moved against the income statements at two of the three companies: receivables, inventory, and gross debt rose at LGES and Samsung SDI even as reported margins improved. Below: the Q2 card for each maker, the cross-company debt and working-capital picture, and where the evidence runs out. - **LGES Ex-Credit Loss Narrows But Persists** — [Source]() — Published 2026-08-14 Tag: LGES Profit Reported operating profit KRW 113.3B on KRW 241.0B in disclosed 45X credits. Company-reported ex-credit operating loss: KRW 127.7B, margin negative 1.7%. That loss narrowed KRW 269.9B from Q1's negative KRW 397.6B ex-credit result — the rate of deterioration reversed, but underlying profitability has not. - **Samsung SDI Positive After Seven-Quarter Loss Streak** — [Source]() — Published 2026-08-14 Tag: Samsung Profit Battery segment operating profit KRW 159.3B, up from negative KRW 177B in Q1. KRX filing discloses KRW 107.7B consolidated AMPC, producing a mechanical ex-AMPC profit of KRW 96.1B. That residual still contains an unquantified tariff-refund benefit — Samsung SDI did not isolate it in public materials. - **SK On Record Quarter Built on Undisclosed Drivers** — [Source]() — Published 2026-08-14 Tag: SK On Profit Battery operating profit KRW 821.8B, a KRW 1.17T swing from Q1. Management attributed the result to higher Asian volumes, customer compensation, increased AMPC, and BlueOval SK restructuring savings. No public filing reviewed quantifies the compensation amount or the AMPC contribution separately. - **LGES Cash Position Rose on One-Time Disposal** — [Source]() — Published 2026-08-14 Tag: LGES Cash Operating cash flow turned positive at KRW 25B against KRW 1.33T EBITDA. Working capital consumed KRW 1.185T as receivables rose KRW 818B and inventory KRW 1.09T QoQ. Cash increased KRW 3.4T in total, but KRW 3.74T of that came from a non-recurring Honda JV building disposal. The feature below examines the conversion mechanics in detail. - **Gross Debt Rose at LGES and Samsung SDI** — [Source]() — Published 2026-08-14 Tag: Debt Trajectory LGES gross debt increased KRW 4.44T QoQ to KRW 29.12T. Samsung SDI debt rose KRW 457B to KRW 12.11T while cash fell KRW 232B. SK Innovation consolidated net debt declined KRW 0.9T QoQ to KRW 23.7T, driven by BlueOval SK JV removal from the consolidation perimeter, but remains KRW 1.1T above year-end 2025. - **Receivables and Inventory Climbed at Two Makers** — [Source]() — Published 2026-08-14 Tag: Working Capital Samsung SDI receivables rose KRW 587B and inventory KRW 376B QoQ during its first profitable quarter. The pattern matches LGES. Consistent with late-quarter shipment loading or slower collection, but neither company attributes the buildup to specific segments or customers in public materials reviewed. - **Credit Disclosure Quality Varies Widely Across Three** — [Source]() — Published 2026-08-14 Tag: Evidence Gap LGES publishes the ex-credit bridge directly in English IR materials. Samsung SDI discloses consolidated AMPC (KRW 107.7B) in Korean KRX filings but omits it from English decks and does not allocate it to the battery segment. SK On quantifies neither AMPC nor customer compensation in any reviewed filing. No company disclosed Q2 utilization rates or cell-level ASP. ### LGES Decomposition - [LGES Q2 2026 — Ex-Incentive Loss Narrowed KRW 270 Billion; Working Capital Absorbed KRW 1.185 Trillion]() — By [Ronan Adike]() · Published 2026-08-14 · Format: The Earnings Decomposition LGES posted its best ex-incentive operating result in five quarters: the underlying loss narrowed KRW 270 billion sequentially, and the improvement came from volume and ramp rather than credit timing. The same quarter absorbed KRW 1.185 trillion in working capital, pushed total debt to KRW 29.1 trillion, and converted KRW 1.330 trillion of EBITDA into KRW 25 billion of operating cash flow. The ESS ramp is improving the operating line and consuming cash faster than the operating line generates it. For a supplier qualification call, the open question has moved from whether LGES reaches breakeven to what its balance sheet looks like when it does. ### New Carlisle Reset - [Samsung SDI Takes Full Ownership of New Carlisle — and Full Risk]() — By [Elise Huan-Cartwright]() · Published 2026-08-14 Samsung SDI acquired GM's 49.99% stake in SynergyCells on August 11, converting the New Carlisle, Indiana plant into a wholly owned facility intended for ESS batteries ([press release](https://www.samsungsdi.com/sdi-now/sdi-news/4982.html)). Purchase price undisclosed. ### Source Access - **LG Energy Solution Q2 2026: KRW 113.3B Operating Profit on KRW 241B in US Incentives** — [Source]() — Published 2026-08-14 Ex-incentive loss narrows to KRW -128B from Q1's KRW -398B. Working capital consumed KRW 1.2T; cash conversion lags. - **Samsung SDI Returns to Profit After Seven Quarters, but the Tariff Refund Stays Unquantified** — [Source]() — Published 2026-08-14 KRW 203.8B reported OP includes KRW 107.7B AMPC plus undisclosed tariff refund. Strip both and the profit is marginal. - **Samsung SDI Takes Full Ownership of New Carlisle Plant, Pivots to ESS-First Production** — [Source]() — Published 2026-08-14 GM exits SynergyCells JV. Samsung SDI gains sole-owned US facility but discloses no revised capacity target or SOP date. - **Samsung SDI Says US LFP Cell Line in Mass-Production Validation, Targets Deliveries Before Year-End** — [Source]() — Published 2026-08-14 StarPlus LFP line aims for Q4 2026 customer shipments. Non-FEOC cathode supply chain claimed via Korean and US partners. - **SNE Research: Chinese Makers Hold 72.6% of Global xEV Battery Market Through May 2026** — [Source]() — Published 2026-08-14 LGES volume up 7.3% YoY but share slips to 8.7%. SK On volume down 5.8%. CATL reaches 40.2%. - **SK On Swings to KRW 822B Operating Profit in Q2, but Three Unseparated Drivers Cloud the Read** — [Source]() — Published 2026-08-14 Volume gains, customer compensation, and higher AMPC all contributed. None individually quantified. IRA reclassification adds noise. ## Other sections in Issue 10 - [Signal]() - [China]() - [The Log]() - [Defense]() - [Qualification]() ## More - [Publication guide]() - [Issue archive]()