Samsung hits $1 trillion valuation as AI chip boom drives record rally and historic profits

Samsung hits $1 trillion valuation, joins TSMC's elite club as AI chip boom powers record rally

Samsung Electronics Co. has reached a $1 trillion market valuation after booming demand for chips used in artificial intelligence saw the world's largest memory maker's stock more than quadruple over the past year. The milestone came as the South Korean company's shares rallied as much as 11% early on Wednesday, making it only the second Asian firm after Taiwan Semiconductor Manufacturing Co. to hit the mark. The gains boosted the Kospi benchmark above the 7,000 level. Samsung, alongside memory peer SK Hynix Inc. and TSMC, sits at the heart of a transformation that has made Asia a cornerstone of the global AI ecosystem, pairing chipmaking dominance with expanding data infrastructure. That shift has fueled a powerful rally in regional tech stocks -- SK Hynix and TSMC also reached record highs this month -- as investors bet on sustained demand for advanced chips and computing capacity. "The trillion dollar threshold carries material weight beyond the symbolism," said Dave Mazza, chief executive officer at Roundhill Investments in New York. "More broadly, it reflects a market judgment that memory's role in the AI infrastructure stack is structural, not cyclical." Just days ago, Samsung's semiconductor arm brought in historic profit over the March quarter beating expectations with a 48-fold jump as AI data center orders delivered hefty margins. Analysts expect the division to build on its record-breaking profit over the next several quarters as contract prices continue their steep upward trajectory amid limited supply. Meanwhile, Apple Inc. has held exploratory discussions about using Samsung to produce the main processors for its devices in the US, a move that would offer a secondary option beyond longtime partner TSMC. "If investors do some work on Samsung Electronics we think they will conclude that the investment opportunity is attractive even if they have missed its performance up until now," said Sam Konrad, investment manager at Jupiter Asset Management. "The memory market is currently undersupplied, and Samsung said that 2027 will see tighter supply and demand than 2026, so prices for NAND and DRAM are likely to continue rising." That said, Samsung is facing some challenges too. The chip unit's earnings growth contrasts with declines in Samsung's mobile and displays operations, which are fighting rising materials and components prices. The profits generated by the AI boom are also prompting Samsung employees to demand a bigger share, with workers threatening an 18-day general strike later this month. Still, the stock is expected to rise around 30% over the next 12 months, according to sell-side analyst estimates compiled by Bloomberg. It is trading at just 5.3 times one-year forward earnings, down from 14.4 times in October. The dizzying gains in Samsung and SK Hynix shares -- which together command a weightage of more than 43% in the benchmark Kospi index, have helped make Korea one of the world's hottest markets. The benchmark rose as much as 5.4% on Wednesday, and a jump in futures prompted the bourse to halt program buying. The Korean duo have also played a role in lifting Asia's stock benchmark to all-time highs. As the companies ride the AI spending boom, investors argue that memory is in a super-cycle of demand that's breaking a decades-old cycle of boom and bust. "Corporate earnings in aggregate keep getting stronger and it's mainly coming from one place -- from the technology sector," said Mark Davids, APAC head of the emerging markets and Asia Pacific equities team at JPMorgan Asset Management. Samsung's profits reflect a "very unusual period where these companies can achieve outsized profits," he said.

Samsung's Market Value Hits $1 Trillion

Samsung Electronics has joined the rarified air of companies valued over a trillion dollars as its stock continued to be boosted by the boom in artificial intelligence. Shares of the world's top memory-chip maker have more than doubled this year, thanks to AI's red-hot demand for its chips. On Wednesday they jumped 13% in early trade, bringing Samsung's market capitalization to 1,530 trillion won, equivalent to $1.04 trillion. It is only the second Asian company with a market valuation above $1 trillion, aside from Taiwan Semiconductor Manufacturing Co. Investors have been piling into the tech sector recently, with appetite for Samsung further boosted by its record first-quarter earnings last week. Its revenue, net and operating profits scored all-time highs. There is also little sign that chip demand will slow anytime soon. The company said it production capacity was fully sold out for this year. Samsung is widely expected to continue benefiting from tight supply and high prices for memory products, as the global AI-infrastructure buildout continues. Its chip-making division posted a record operating profit and accounted for more than 90% of the company's total earnings for the quarter, outweighing the sluggish performance in other segments. Samsung expects revenue from high-bandwidth memory products--a critical component of AI chips--to more than triple this year, with its recently launched HBM4 likely to account for more than half of total HBM revenue. Nomura analysts noted that chip makers are shifting toward more secular growth, moving from the highly cyclical patterns of the past. That should lower the risk premium on Samsung's shares as the company will be supported by longer supply contracts, they added in a recent note. "We expect the trend should help gradually alleviate the excessive discount applied to the share price in the market," the analysts led by C.W. Chung said in a note. Samsung's surge helped drive Korea's benchmark Kospi index 6.7% higher to 7402.18, above the 7000 level for the first time.