Abstract:
Samsung Electronics' profits hit a new high, thanks to rising memory chip prices and continued global investment in artificial intelligence (AI) infrastructure. The company's operating profit climbed to about 107.4 trillion won ($80.1 billion) in the three months to September, more than eight times the same period last year. Analysts had on average forecast operating profit of 108.7 trillion won. Preliminary data released on Thursday showed revenue in the quarter of 195 trillion won, lower than expected.
Record operating profits and soaring expectations underscore that the economic benefits of the AI boom are tilting heavily toward Samsung, SK Hynix and Micron Technology as data center developers scramble to purchase memory chips for their AI servers. Counterpoint Research raised its forecast for DRAM price growth in the third quarter to 10%-20% from the previous 5%-10%, pointing out that customers are placing orders in advance and suppliers have enhanced pricing power.
This AI craze has completely changed Samsung’s semiconductor business. Just a few years ago, Samsung's semiconductor business was mired in losses due to a sharp decline in demand. Today, AI infrastructure construction is consuming large amounts of advanced DRAM, and Samsung is catching up with SK Hynix in the field of high-bandwidth memory. The strength of this cyclical boom has already been reflected in South Korea's trade data, with the country's chip exports surging 263% in September from a year earlier.
Analysts on average expected Samsung's chip unit to achieve an operating profit of 110 trillion won, while its electronics unit posted a loss. Samsung will release its full financial statements around the end of this month.
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