Samsung posts record profit up eightfold as AI chips demand defies geopolitical uncertainties

Samsung Profit Up Eight-Fold After AI Chip Sales Defy War Fears

Samsung Electronics Co. earned a stronger-than-expected eight-fold leap in quarterly profit, underscoring robust demand for memory chips used for artificial intelligence and data centers even amid uncertainties triggered by war in the Middle East. The chips-to-smartphones conglomerate reported preliminary operating profit of 57.2 trillion won ($37.9 billion) in the March quarter -- a record -- versus analysts' average projection for 39.3 trillion won. Revenue climbed to 133 trillion won, against the average estimate of 116.8 trillion won. The company will release a full financial statement, including net income and divisional breakdowns, later this month. Samsung's shares, which gained more than 120% last year, have shed about 12% from their peak in February, hurt by fears that the conflict in Iran may spiral into higher prices and interest rates and hurt the durability of booming spending on AI hardware. Customers led by cloud service providers are ramping up Samsung's orders, lifting both volumes and margins. The average selling price of global DRAM surged 64% in the first quarter from the previous quarter, Citigroup analysts Peter Lee and Jayden Oh wrote in an April 2 report. Samsung dominates global memory supply along with SK Hynix Inc. and Micron Technology Inc. The trio has increasingly shifted production in recent years toward high-bandwidth memory used in Nvidia Corp.'s AI accelerators, tightening supply of conventional memory. Samsung's first-quarter operating profit dwarfs its performance in other quarters and compares with the 43.6 trillion won the company generated in all of 2025. South Korea's semiconductor exports -- a bellwether of global technology demand -- soared 151.4% in March to a record $32.8 billion, government data show. Analysts remain upbeat on South Korea's biggest company, largely dismissing concerns about AI optimization by offerings such as Google's TurboQuant or Anthropic's Claude Mythos. Citigroup forecasts annual operating profit of 310 trillion won -- or the equivalent of $206 billion -- in 2026, saying it expects strong AI inference demand to sustain pricing.

Samsung forecasts record profit on AI boom

Samsung Electronics has projected that its operating profit surged more than eightfold to a record in the first quarter, citing an "unprecedented supercycle" for memory chips from the AI boom. This comes despite the deepening Middle East conflict that has sharply increased energy costs for data centres. Samsung forecast an operating profit of Won57.2tn ($38bn) in the first three months of this year, more than its entire 2025 operating profit of Won43.6tn. The company reported a Won6.7tn quarterly profit a year earlier. The guidance was far better than the Won40.5tn projected by LSEG SmartEstimates. Sales were projected to increase 68 per cent to Won133tn. "It couldn't be better," said Daniel Kim, an analyst at Macquarie. "It is historically the best single print ever for Korean [chipmaking] corporates. The industry supercycle is expected to outlast the Iran war." The strong performance boosted Samsung shares 5 per cent to Won203,000 on Tuesday morning. The shares have fallen about 6 per cent since the war began in late February but are still up nearly 70 per cent this year on robust Big Tech AI investments. Analysts said the war had not had a big impact on chip production and prices as a severe semiconductor shortage had outweighed rising energy costs. There are concerns about potential disruption to the supply of raw materials such as helium, but Kim said Korean chipmakers had more than six months of the inert gas in its inventories.

Samsung flags eightfold jump in Q1 profit as AI chip demand drives up prices

SEOUL, April 7 (Reuters) - Samsung Electronics (005930.KS), opens new tab on Tuesday projected a record-high first-quarter profit, up more than eightfold from a year earlier and well above expectations as booming demand for artificial intelligence infrastructure caused supply bottlenecks and drove chip prices higher. The world's largest memory chipmaker estimated an operating profit of 57.2 trillion won ($37.92 billion) for the ⁠January to March period, compared with an LSEG SmartEstimate of 40.6 trillion won and a more than eight-fold jump from 6.69 trillion won a year earlier. The preliminary results nearly triple Samsung's previous record quarterly operating profit of 20 trillion won, reached in the fourth quarter last year. Samsung has emerged as one of the major beneficiaries of the AI data centre boom that has constrained supply for traditional chips used in smartphones, PCs and game consoles and led to a near-doubling in chip prices in the first quarter alone. Research ⁠TrendForce expects contract DRAM memory chip prices to increase more than 50% in the current quarter as the shortage persists. About a year ago, Samsung CEO apologised for its disappointing earnings and share price performance, after the tech giant lagged its rivals in supplying high bandwidth memory (HBM) chips critical ⁠to Nvidia's (NVDA.O), opens new tab AI chipsets. But Samsung has been narrowing the gap with South Korean rival SK Hynix (000660.KS), opens new tab with its latest HBM4 chips while benefiting from the rebound in traditional chip demand fueled by AI ⁠inference, which allows AI models like ChatGPT to generate responses in real time. Last month, U.S. memory chip maker Micron Technology (MU.O), opens new tab forecast third-quarter revenue above Wall Street expectations after posting record ⁠earnings in the second quarter on booming AI demand and tight supply. Samsung said its revenue was expected to grow 68% to 133 trillion won in the January to March period. Reporting by Hyunjoo Jin and Heekyong Yang; Editing by Sonali Paul Our Standards: The Thomson Reuters Trust Principles., opens new tab

Samsung shares rise nearly 5% on record-breaking earnings forecast buoyed by AI chip demand

The guideline suggests that Samsung is regaining ground in the high-bandwidth memory race. Shares of Samsung Electronics rose as much as 4.8% on Tuesday after the South Korean technology giant forecast record quarterly profit amid strong demand for artificial intelligence chips. Shares later pared gains to trade up 0.52%. In its preliminary earnings guidance, Samsung projected its operating profit for the January-March quarter to reach 57.2 trillion won ($37.8 billion), up more than eightfold from just 6.69 trillion won a year ago. That profit, if it comes to fruition, would represent a quarterly record -- nearly three times the previous high -- and would exceed estimates of 42.3 trillion won from LSEG SmartEstimate, which is weighted toward forecasts from analysts who are more consistently accurate. Meanwhile, the company's estimated consolidated revenue was projected to surge nearly 70% from a year ago to 133 trillion Korean won. Samsung's upbeat guidance was likely driven by its memory chip business, particularly demand for high-bandwidth memory chips used in AI computing. Its Device Solutions division, which includes memory chips, accounted for 39% of Samsung's revenues and 57% of its operating profits in 2025. Demand for high-bandwidth memory chips has become so explosive over the past year that it has triggered shortages across the memory market, driving massive price and volume spikes for memory makers like Samsung. The results also reflect that Samsung has been strengthening its position in high-bandwidth memory chips after giving up an early lead to its South Korean rival SK Hynix. The company is expected to report full earnings later this month.

Samsung Q1 2026 record profit forecast on AI chip demand

An operating profit of 57.2 trillion won ($37.8 billion) for the January-to-March period of 2026 -- representing a greater-than-eightfold year-over-year gain from 6.69 trillion won and an all-time quarterly high -- is what Samsung Electronics said this week it expects to report. Put another way, that result would be roughly three times the prior quarterly peak of 20.07 trillion won, which Samsung posted in Q4 2025, Reuters noted. Analyst expectations were comfortably cleared: Reuters placed the LSEG SmartEstimate consensus at 40.6 trillion won, while CNBC reported a 42.3 trillion won figure from the same service, which gives greater weight to forecasters with stronger track records. On the top line, 133 trillion won in first-quarter revenue is what Samsung guided to, a roughly 68% jump versus the 79.14 trillion won it recorded in the year-ago quarter. The results were driven by the memory chip business, where demand for chips used in AI computing has outpaced supply and pushed prices higher. TrendForce, a market research firm, has projected that the ongoing supply crunch will push contract DRAM prices up by more than half during the current quarter. Samsung has also benefited from a weakening South Korean won, which has boosted repatriated earnings, according to Reuters. According to Reuters, one analyst's breakdown put the memory chip unit's operating profit at 54 trillion won for the quarter, with the logic chip side of the business running a 1.6 trillion won deficit. The handset business came in at around 4 trillion won in profit, edging down compared with the same quarter in 2025. Shares initially surged up to 4.8% on the news before giving back most of those gains, with the stock finishing the session up 1.76%, CNBC reported. The company faces potential headwinds in the coming quarters. Chipmakers including Samsung face potential materials shortages tied to the U.S.-Israel conflict with Iran, which has interrupted the flow of key inputs to semiconductor production -- among them helium. TrendForce Senior Vice President Avril Wu told Reuters that spot DRAM prices softened in the prior week, citing difficulty among end consumers in keeping pace with the run-up in pricing. Analysts have also flagged concern about whether memory price increases can be sustained. Samsung said it will release full first-quarter earnings on April 30.

Samsung forecasts insane operating profit growth thanks to surging memory prices - SiliconANGLE

Samsung forecasts insane operating profit growth thanks to surging memory prices Samsung Electronics Co. Ltd. forecast record quarterly profit thanks to rising demand for its memory chips to support artificial intelligence workloads, sending its stock higher during today's market session. The stock was up almost 5% at one point, before settling back down to a 2% gain. The company, which is the world's largest supplier of memory chips, forecast a first-quarter operating profit of 57.2 trillion won (around $37.9 billion), crushing the analyst estimate of 40.6 trillion won. That figure is up more than eightfold from the 6.69 trillion won profit it recorded in the year-ago quarter. It's also triple the amount of its previous record operating profit of 20 trillion won, which was racked up just three months earlier. Samsung has emerged as one of the top beneficiaries of the AI boom, thanks to demand for its memory chips outstripping the available supply. Its memory chips are not only used in AI servers in data centers, but also in personal computers, smartphones and many other computing devices. TrendForce expects prices for dynamic random-access memory chips to rise more than 50% in the current quarter due to the ongoing shortages. Meanwhile, Meritz Securities analyst Kim Sunwoo told Reuters that actual contract prices are sometimes even higher than market estimates. In addition, Samsung has benefited from the dwindling value of the South Korean won, which recently fell to a 17-year low against the U.S. dollar, boosting its foreign earnings. While Samsung did not break down its profit numbers in its earnings forecast, Kim said the company's chip division likely accounted for around 54 trillion won, or 95% of the total. In contrast, its smartphone business is expected to have generated a profit of just 4 trillion won, down slightly from the same period a year earlier but above the analyst forecast. The company has made real progress in the high-bandwidth memory chip segment, having previously struggled to bring its most advanced chips to market. Last year, the HBM chip segment was dominated by its rival SK Hynix Inc., but Samsung has since shipped its latest HBM4 chips to customers, helping it to claw back market share. However, most of Samsung's profit comes from the surging price of traditional memory chips, which are needed for AI inference. HBM chips are primarily used for AI training workloads. All told, they accounted for around 5% of the company's chip revenue, analysts said. Kim said Samsung's smartphone business was boosted thanks to its low-cost component inventory. However, as that inventory runs low, it's likely to suffer from lower margins in the second quarter, as it will have to shell out for new supplies at much higher prices. Samsung also provided a forecast for its total revenue, saying it expects this to grow to 133 trillion won, up 68% from a year earlier. The company will publish its results in full on April 30. Still, there are some headwinds on the horizon that could cloud Samsung's rising star in the coming quarters. Rising energy costs due to the U.S.-Iran war have sparked fears that the demand for memory chips for AI data centers might weaken. In addition, the Middle East conflict might cause some disruption to chipmaking supply chains, slowing its momentum. Ryu Young-ho of NH Investment & Securities told Reuters that Samsung will try to restructure its long-term contracts to sustain growth in the semiconductor business, but despite this, "there are concerns about a peak-out in memory price increases." Signs of this have already emerged, with spot prices for DRAM tailing off last week, due to end-users struggling to absorb the elevated prices, analysts said. Samsung's stock was briefly rocked last month when Google LLC introduced a new technology called TurboQuant, which enables AI workloads to run on chips with reduced memory. But even so, the stock quickly rebounded and it's up 61% in the year to date.

Samsung flags eightfold jump in Q1 profit as AI chip demand drives up prices - The Economic Times

Samsung estimated an operating profit of 57.2 trillion won ($37.92 billion) for the January to March period, compared with an LSEG SmartEstimate of 40.6 trillion won and a more than eight-fold jump from 6.69 trillion won a year earlier.Samsung Electronics on Tuesday projected a record-high first-quarter profit, up more than eightfold from a year earlier and well above ⁠expectations as ⁠booming demand for artificial intelligence infrastructure caused supply bottlenecks and drove chip prices higher. The world's largest memory chipmaker estimated an operating profit of 57.2 trillion won ($37.92 billion) for the January to March period, compared with an LSEG SmartEstimate of 40.6 trillion won and a more than eight-fold jump from 6.69 trillion won a year earlier. The preliminary results nearly triple Samsung's previous record quarterly operating profit ⁠of 20 trillion won, reached in the fourth quarter last year. Samsung has emerged as one of the major beneficiaries of the AI data ⁠centre boom that has constrained supply for traditional chips used in smartphones, PCs and game consoles and led to a near-doubling in chip prices in the first quarter alone. Research TrendForce expects contract DRAM memory chip prices to increase more than 50% in the current quarter as the shortage persists. About a year ago, Samsung CEO apologised for its disappointing earnings and share price performance, after the tech giant lagged its rivals in supplying high bandwidth memory (HBM) chips critical to Nvidia's AI chipsets. But Samsung has been narrowing the gap with South Korean rival SK Hynix with ⁠its latest HBM4 chips while benefiting from the rebound in traditional chip demand fueled by AI inference, which allows AI models like ChatGPT to generate responses in real time. Last month, U.S. memory chip maker Micron Technology forecast third-quarter revenue above Wall Street expectations after posting record earnings in the second quarter on booming AI demand and tight supply. Samsung said its revenue was expected to grow 68% to 133 trillion won in the January to March period.

Samsung Apologized Last Year For Lagging In AI Chips, Now The Company Eyes Record Profit Of Nearly $38 Bi

On Tuesday, Samsung Electronics (OTC:SSNLF) projected a first-quarter operating profit of about KRW 57.2 trillion ($37.92 billion). AI Boom Fuels Samsung's Record Profit Surge The projection blows past expectations and exceeds the company's total profit for all of last year. The world's largest memory chipmaker's first-quarter operating profit marks an increase of more than eight times from 6.69 trillion won a year earlier. The figure also nearly triples Samsung's previous quarterly record of 20 trillion won, set in the fourth quarter of last year. Chip Shortage Pushes Memory Prices Higher The AI boom has strained global chip supply, particularly for memory, sending prices sharply higher. Analysts say DRAM prices nearly doubled in the first quarter and could climb more than 50% again in the current quarter as shortages persist, Reuters reported. Higher contract prices, driven by customer stockpiling ahead of further increases, helped Samsung deliver a significant earnings beat. Chip Division Dominates Earnings Kim Sunwoo, a senior analyst at Meritz Securities told the publication that Samsung's semiconductor business accounted for roughly 95% of total operating profit. While the company remains the world's second-largest smartphone maker after Apple Inc. (NASDAQ:AAPL), its mobile division posted a modest profit decline. The weaker South Korean won also boosted earnings by increasing the value of overseas revenue. Catching Up In AI Memory Race Last year in March, Samsung's CEO issued a rare apology following weak earnings and share price performance. At the time, the company fell behind competitors in supplying high-bandwidth memory (HBM) chips essential for Nvidia Corp's (NASDAQ:NVDA) AI processors. Since then, it has begun narrowing the gap with rival SK Hynix by shipping newer-generation HBM chips. Still, most of Samsung's current gains come from traditional DRAM and NAND chips, as AI demand boosts the broader memory market. Outlook Remains Strong Despite Risks Samsung said it expects first-quarter revenue to rise about 68% year over year to 133 trillion won. The company is scheduled to release detailed earnings results on April 30. Price Action: Shares of Samsung rose 0.73% to 194,500 won on Tuesday, outperforming the KOSPI, which gained 0.28%, according to Benzinga Pro. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo Courtesy: Sybillla on Shutterstock.com Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Earnings surprise puts Samsung Electronics on course for 300T annual operating profit

Cars form a line at the entrance to Samsung Electronics' main campus in Suwon, Gyeonggi Province, on April 7, 2026. (Yonhap) Samsung Electronics reported 57.2 trillion won in operating profit in the first quarter of the year, an earnings surprise that far exceeded projections. In short, the wave of the semiconductor "super cycle" fueled by AI investment is even bigger than the market had predicted. Memory chip prices have been soaring despite the global economic shock brought by the US and Israel's war with Iran. Many even think Samsung's operating profits for this year will reach 300 trillion won, which would be more than the combined profits of all companies listed on the KOSPI index last year (245 trillion won). The 57.2 trillion won of operating profit Samsung announced Tuesday is nearly three times the 20.1 trillion won it posted in last year's fourth quarter, and more than eight times the 6.7 trillion won recorded in the first quarter of 2025. In effect, the Korean electronics giant earned nearly 2 trillion won every three days, even including last quarter's extended holiday for the Lunar New Year. Financial analysts estimated that Samsung's operating profit included 52 trillion-53 trillion won for chips, 3.4 trillion-4.1 trillion won for consumer goods (including smartphones and home electronics), 300 billion-500 billion won for displays and 300 billion-400 billion won for Harman International (an audio electronics subsidiary). Inside the semiconductor division, the foundry (semiconductor production on demand) and non-memory sectors are estimated to have posted a loss of over 1 trillion won. That suggests Samsung earned over 54 trillion won from memory chips alone. Samsung plans to provide more details in an earnings briefing on April 30. This boom in the memory sector is driven by Big Tech's cutthroat drive to invest in AI. AI-related investments by the four US-based tech firms of Google, Microsoft, Meta and Amazon are projected to reach well over 1 quadrillion won, or around $700 million. These firms are locked in a no-holds-barred investment brawl, each determined to be the "last man standing" in the AI market. Samsung Electronics also strengthened its grip on the market with the launch of its cutting-edge HBM4 AI memory chip this past February. Producers' focus on the high-bandwidth memory needed for AI chips has left regular memory chips in short supply. The fixed transaction price (that is, the corporate wholesale price) of DRAM (DDR5 16GB) at the end of last month exhibited a sevenfold year-over-year increase. Following Samsung Electronics' shocking earnings report on Tuesday, market analysts have been upping their forecasts for the company's yearly performance. While analysts' initial projections for Samsung's profits this year were an average of 227 trillion won, Citigroup and KB Securities are now projecting that its profits will exceed 300 trillion won, with the former predicting 310 trillion won and the latter 327 trillion won. "We predict that the memory sector will have 316 trillion won in operating profits this year, a tenfold increase from the previous year. Samsung Electronics could even reach 488 trillion won in operating profits overall next year, which would make it the leading company in terms of global operating profits," predicted Kim Dong-won, a senior managing director at KB Securities. Kim thinks that the semiconductor super cycle will continue through next year, driven by a supply shortfall and growing structural demand in the market. Nvidia, which boasts the world's biggest market cap, reported around US$120 billion in profit over the past year (February 2025-January 2026). The market is closely watching SK Hynix, which is set to announce its tentative first-quarter performance at the end of April. The average projection is that the Korean chipmaker will post first-quarter profits of 32 trillion won. Samsung Electronics and SK Hynix stock finished the day at 196,500 and 916,000 won, respectively, on the KOSPI index on Tuesday. Those prices were up 1.76% and 3.39% from the previous day of trading. Despite uncertainty over the conflict in the Middle East, Samsung seems to be on the verge of regaining the 200,000 won mark. By Park Jong-o, staff reporter; Bae Ji-hyun, staff reporter

Samsung Electronics estimates $37.9 bil. 'super surprise' profit for Q1 - The Korea Times

Samsung Electronics on Tuesday provided its earnings guidance for the first quarter of this year, predicting 57.2 trillion won ($37.9 billion) in operating profit and 133 trillion won in sales, achieving record-breaking profitability amid a global surge in demand for artificial intelligence (AI) chips. The operating profit soared 755 percent from a year earlier, while the sales also jumped 68 percent during the same period. Quarterly sales and operating profit exceeded 100 trillion won and 50 trillion won, respectively, for the first time in the company's history. The quarterly operating profit also surpassed Samsung Electronics' 2025 full-year operating profit of 43.6 trillion won in just three months. The numbers far outpaced brokerages' earnings consensus of 117 trillion won in sales and 38.1 trillion won in operating profit, prompting analysts to describe the guidance as "a super surprise." The earnings beat concerns over a potential downturn in the memory market, fueled by Google's TurboQuant, a technology that reduces AI memory usage, as well as a potential peak in memory prices and global supply chain uncertainties stemming from the Middle East conflict. Since this is an earnings guidance, Samsung Electronics did not provide a breakdown. However, the strong performance is believed to have been driven by its semiconductor business. Mirae Asset Securities said Samsung Electronics' Device Solutions (DS) division alone is estimated to have posted more than 42 trillion won in operating profit in the first quarter. The surge was fueled by explosive demand for memory chips amid the expansion of the AI industry. Samsung Electronics recently began mass production shipments of its sixth-generation high-bandwidth memory 4 (HBM4). Prices of legacy DRAM used in servers, PCs and mobile devices also rose sharply, providing an additional boost. Against this backdrop, Big Tech companies in recent months have signed pricey long-term memory supply agreements with Samsung Electronics as they prioritize securing supply over price negotiations. Reportedly, DRAM contract prices for the second quarter are being negotiated at more than a 30 percent increase from the first quarter, and long-term agreements of three to five years are being signed at minimum prices set above first-quarter levels. The company's Mobile Experience (MX) division is also estimated to have posted revenue improvement driven by the launch of the Galaxy S26 series earlier this year, but its operating profit likely nearly halved to around 2 trillion won due to soaring memory prices.

Samsung sees eightfold increase in Q1 profit on soaring AI chip demand By Investing.com

Investing.com-- Samsung Electronics (KS:005930) projected a sharp surge in first-quarter profit on Tuesday, as booming demand for artificial intelligence chips drove a strong recovery in its semiconductor business. The company said it expects operating profit of about 57.2 trillion won ($38 billion) for the January-March period, marking a more than eightfold jump from 6.69 trillion won a year earlier. Get real-time earnings updates, share moves with InvestingPro Revenue is estimated at around 133 trillion won, compared with 79.14 trillion won in the same period last year. The upbeat outlook underscores a powerful rebound in the memory chip market, where demand for high-bandwidth memory (HBM) and other AI-related semiconductors has accelerated amid rapid growth in generative AI applications. Samsung, the world's largest memory chipmaker, has been benefiting from tightening supply and rising prices, as major technology firms ramp up investment in data centers and AI infrastructure. The earnings guidance also points to a significant improvement from the previous quarter, when the company reported operating profit of 20.07 trillion won on revenue of 93.84 trillion won. Samsung did not provide a detailed breakdown by division and will release full earnings results later this month.

Samsung flags eightfold jump in quarterly profit as AI chip demand pumps prices - VnExpress International

Samsung has emerged as one of the major beneficiaries of the AI data center boom that has constrained supply for traditional chips used in smartphones, PCs and game consoles and led to a near-doubling in chip prices in the first quarter alone. The world's largest memory chipmaker estimated an operating profit of 57.2 trillion won ($37.92 billion) for the January to March period, compared with an LSEG SmartEstimate of 40.6 trillion won and a more than eightfold jump from 6.69 trillion won a year earlier. The record-high results nearly triple Samsung's previous record quarterly operating profit of 20 trillion won, reached in the fourth quarter last year. Research firm TrendForce expects contract DRAM (dynamic random access memory) chip prices to increase more than 50% in the current quarter as the shortage persists. "As customers anticipated further increases, actual ⁠contract prices came in higher, leading to the beat," Kim Sunwoo, a senior analyst at Meritz Securities, said. The company is also gaining from a slump in the South Korean currency to a near 17-year low against the U.S. dollar, which has boosted repatriated earnings. Samsung's shares ended up 1.8% to 196,500 won per share on Tuesday morning, outperforming a 0.8% rise in the wider market. Rival SK Hynix's shares finished 3.4% higher. Kim estimated Samsung's memory chip business generated 54 trillion won in operating profit, while its logic chip divisions posted a loss of 1.6 trillion won. The world's No.2 maker of smartphones after Apple fared better than feared in its mobile division, posting a 4 trillion won profit, a slight decline from a year earlier. The mobile business was supported by the use of low-cost component inventories, he said, but its margins will likely come under increasing pressure in the second quarter due to rising costs of memory chips and other components and materials amid the war in the Middle East. Samsung said its revenue was expected to grow 68% to 133 trillion won in the January to March period. The company will release details of its first-quarter earnings on April 30. Headwinds The rise in energy costs since the start of the U.S.-Israeli war with Iran ⁠has sparked worries that cooling demand from AI data centers and other customers as well as disruptions to the supply of key chipmaking materials could slow the growth momentum for chip makers. "There are growing concerns about a peak-out in memory price increases. It does appear that we are now past the initial upcycle phase and into a later stage," said Ryu Young-ho, a senior analyst at NH Investment & Securities. He said the key issue would be how Samsung structures long-term contracts with customers to sustain its semiconductor earnings. In a sign of cooling growth, spot prices for DRAM chips eased last week, as "end-user demand struggled to absorb elevated prices," said TrendForce Senior Vice President Avril Wu. Spot DRAM prices refer ⁠to current market prices and trade at premiums over fixed-term contract prices. These concerns, as well as the unveiling of memory-saving technology from Google called TurboQuant last month, have contributed to a selloff in memory chip stocks, with Samsung's shares losing 9% since the war began on February 28. That said, its shares are still up over 60% this year, following a 125% jump the previous year. High bandwidth memory gains ground About a year ago, Samsung CEO apologised for its disappointing earnings and ⁠share price performance, after the tech giant lagged its rivals in supplying high bandwidth memory (HBM) chips critical to Nvidia's AI chipsets. But Samsung has been narrowing the gap with South Korean rival SK Hynix by shipping its latest HBM4 chips to Nvidia in February. However, Samsung's soaring earnings stem mainly from the rebound in traditional chip demand fueled by AI inference, which allows AI models like ChatGPT to generate responses in real time, ⁠which has exacerbated a shortage of commodity chips. HBM chips accounted for less than 10% of Samsung's DRAM chip revenue in the first quarter, according to estimates by Sohn In-joon, an analyst at Heungkuk Securities. He expects Samsung's total operating profit to reach another record high of 75 trillion won in the current quarter, underpinned by an over 30% rise in DRAM chip prices.

Samsung Projects Eightfold Profit Leap as AI Chip Demand Soars -- Update

Samsung Electronics, the world's largest memory-chip maker, forecast a more than eightfold jump in first-quarter operating profit, signaling continued record earnings amid the artificial-intelligence boom despite uncertainties fueled by the Middle East conflict. The stronger-than-expected quarterly profit estimate comes as global tech companies rush to secure advanced chips for AI data centers, boosting memory prices and, in turn, margins in Samsung's flagship semiconductor business. The company expects the momentum to continue. Most analysts expect the company's core semiconductor business to have driven the strong earnings, supported by higher-than-expected prices for DRAM and NAND--the two main types of memory chips--on solid demand for AI infrastructure buildout. In preliminary results Tuesday, the South Korean technology company said its operating profit likely reached 57.200 trillion won, equivalent to $37.91 billion, for the January-March period. That would be 755% higher than the year-earlier figure, topping a FactSet-compiled consensus estimate of 39.140 trillion won. It would also be nearly triple the company's previous record of around 20 trillion won set in the fourth quarter of 2025. Quarterly revenue is forecast to have risen 68% to a record 133.000 trillion won, Samsung said. The AI chip boom is set to fuel a run of record quarterly operating profits for Samsung this year, Meritz Securities analysts Kim Sun-woo and Woo Seo-hyun said. Ahead of the preliminary results, they forecast operating profit of 73 trillion won in the second quarter, 90 trillion won in the third quarter and 104 trillion won in the fourth quarter. In a sign of strong investor optimism about the company's growth outlook, its shares have climbed more than 60% this year despite a recent correction triggered by the Middle East conflict. The stock rose nearly 5% in early Seoul trading, moving closer to its all-time high set earlier this year. Last month, Samsung said it planned to invest more than $70 billion in facilities and research and development this year to strengthen its memory, foundry and advanced-packaging capabilities, ramping up spending to solidify its leadership in AI-chip manufacturing. In a major win for its U.S. foundry business, the company last year signed a $16.5 billion multiyear deal with Tesla. It expects to begin mass producing AI chips for the U.S. EV maker at its Texas plant in the second half of next year, with Tesla Chief Executive Elon Musk saying the Samsung facility will produce Tesla's next-generation AI6 chip. Samsung is also manufacturing Groq 3 language processing units--the latest AI inference chips--for Nvidia, with shipments due to start in the second half of 2026, Nvidia CEO Jensen Huang said at an AI conference in San Jose, Calif., last month. Samsung in February said it became the world's first to mass produce the most advanced high-bandwidth memory chips, known as HBM4, and plans to provide upgraded HBM4E samples later this year. It also expanded ties with Advanced Micro Devices in March, signing a preliminary agreement to supply HBM4 chips for AMD's next-generation AI accelerators. Samsung is scheduled to release full quarterly results, including a breakdown of earnings by business segment, later this month.

Samsung flags eightfold jump in Q1 profit as AI chip demand drives up prices

SEOUL, April 7 (Reuters) - Samsung Electronics on Tuesday projected a record-high first-quarter profit, up more than eightfold from a year earlier and well above expectations as booming demand for artificial intelligence infrastructure caused supply bottlenecks and drove chip prices higher. The world's largest memory chipmaker estimated an operating profit of 57.2 trillion won ($37.92 billion) for the January to March period, compared with an LSEG SmartEstimate of 40.6 trillion won and a more than eight-fold jump from 6.69 trillion won a year earlier. The preliminary results nearly triple Samsung's previous record quarterly operating profit of 20 trillion won, reached in the fourth quarter last year. Samsung has emerged as one of the major beneficiaries of the AI data centre boom that has constrained supply for traditional chips used in smartphones, PCs and game consoles and led to a near-doubling in chip prices in the first quarter alone. Research TrendForce expects contract DRAM memory chip prices to increase more than 50% in the current quarter as the shortage persists. About a year ago, Samsung CEO apologised for its disappointing earnings and share price performance, after the tech giant lagged its rivals in supplying high bandwidth memory (HBM) chips critical to Nvidia's AI chipsets. But Samsung has been narrowing the gap with South Korean rival SK Hynix with its latest HBM4 chips while benefiting from the rebound in traditional chip demand fueled by AI inference, which allows AI models like ChatGPT to generate responses in real time. Last month, U.S. memory chip maker Micron Technology forecast third-quarter revenue above Wall Street expectations after posting record earnings in the second quarter on booming AI demand and tight supply. Samsung said its revenue was expected to grow 68% to 133 trillion won in the January to March period. (Reporting by Hyunjoo Jin and Heekyong Yang; Editing by Sonali Paul)