Samsung Electronics has announced a remarkable surge in operating profit, reporting a 32% increase driven by robust demand in the artificial intelligence (AI) sector and strong performance in its semiconductor division. The South Korean tech giant's resurgence is largely attributed to its ability to capitalize on the growing need for advanced memory chips used in AI servers and devices.
The company's semiconductor division played a pivotal role in this financial upswing, posting an operating profit of 7 trillion won for the September quarter, significantly exceeding analysts' forecasts of 4.7 trillion won. This impressive performance underscores the increasing demand for Samsung's High Bandwidth Memory (HBM) chips, particularly the HBM3E, which are essential for AI applications. Samsung is actively selling HBM3E chips to major customers and is gearing up to focus on the next-generation HBM4 in 2026.
The surge in AI-related demand has had a ripple effect, boosting prices and sales volumes of general-purpose DRAM and NAND. This allowed Samsung's semiconductor division to generate nearly half of the company's total profit. Furthermore, Samsung has secured a crucial approval from Nvidia for its latest 12-layer HBM3E chips, solidifying its position in the high-stakes memory competition. The company has also inked a deal to supply chips to OpenAI's Stargate project.
Beyond semiconductors, Samsung's mobile business also contributed to the positive results, with an operating profit of KRW 3.6 trillion, supported by strong sales of premium handsets. The display division also generated a profit of KRW 1.2 trillion.
Looking ahead, Samsung anticipates continued strength in the semiconductor market, fueled by ongoing investments in AI. The company also expects steady demand for smartphones as new models enter the market. Samsung's foundry business, which demonstrated significant earnings improvement in Q3, is aiming for further gains in Q4. The company believes that both its Device Solutions (DS) and Device Experience (DX) units will benefit from new market opportunities as AI adoption accelerates globally. To meet this increasing demand and maintain its competitive edge, Samsung has earmarked 47.4 trillion won (US$33 billion) for capital spending in 2025 to expand and upgrade its capacity.
Analysts are optimistic about Samsung's prospects, with the company's Q3 profit more than doubling estimates at KRW 12.0 trillion. This resurgence signals a complete recovery for Samsung in the high-stakes AI semiconductor market.
