Seoul: Samsung Electronics is expected to post another record-breaking quarterly operating profit, driven by surging demand for AI memory chips and a prolonged global supply shortage that continues to push semiconductor prices higher.
The South Korean technology giant, the world’s largest memory chipmaker by sales, is projected to report an operating profit of 86 trillion won (approximately $56.35 billion) for the April-June quarter, according to an LSEG SmartEstimate based on forecasts from 30 analysts. If realised, the figure would represent an approximately 18-fold increase compared to the 4.7 trillion won reported during the same period a year earlier and mark Samsung’s third consecutive quarter of record operating profit.
The anticipated earnings surge reflects the extraordinary growth in AI infrastructure worldwide, with increasing demand for memory chips significantly outpacing supply. Analysts believe the global memory market is likely to remain undersupplied at least through next year, supporting elevated prices for key semiconductor products.
While high-bandwidth memory (HBM), an essential component for AI processors, has been a major contributor to Samsung’s growth, demand has also strengthened for conventional DRAM and NAND memory products. The expansion of AI applications, particularly the emergence of agentic AI, has increased memory requirements across a wider range of computing tasks.
Unlike earlier AI systems that focused primarily on training large language models, agentic AI performs more sophisticated, multi-step operations requiring higher processing capabilities, additional server memory, and greater storage capacity. This evolution has significantly boosted demand for advanced memory technologies across cloud computing and data centre infrastructure.
Samsung remains one of the world’s leading suppliers of memory chips to major technology companies, including Nvidia, Google, and Apple, placing it at the centre of the global AI hardware ecosystem.
Market research also highlights the strength of semiconductor pricing during the quarter. According to Citi Research, average selling prices for DRAM rose 44 per cent QoQ, while NAND prices increased by 53 per cent, reflecting persistent supply constraints and strong customer demand.
The semiconductor boom has also fuelled a remarkable rally in memory chip stocks. Shares of Samsung Electronics, SK Hynix, and Micron have climbed 158 per cent, 273 per cent, and 242 per cent, respectively, this year, pushing the market valuation of all three companies beyond the $1 trillion mark.
Despite the favourable market environment, analysts caution that Samsung’s reported earnings could be affected by accounting provisions related to employee bonuses. In late May, Samsung reached a wage agreement that prevented a large-scale strike by allocating 10.5 per cent of the semiconductor division’s operating profit towards special bonuses for chip employees.
Some analysts estimate that cumulative bonus provisions could exceed 40 trillion won, making the timing of these accounting charges an important factor that may influence the company’s final quarterly earnings.
Looking beyond the current quarter, industry experts believe the biggest challenge facing Samsung is the sustainability of AI infrastructure investment. Although memory demand remains exceptionally strong, some investors are questioning whether the rapid growth in spending by cloud service providers can continue at the current pace.
According to JPMorgan, AI memory already accounts for an estimated 52 per cent of cloud service providers’ capital expenditure this year and could exceed 70 per cent next year. While memory supply-demand fundamentals remain tight, any slowdown in AI-related investment could weaken future demand and impact the semiconductor industry’s growth trajectory.
Samsung and rival SK Hynix have already announced ambitious long-term expansion plans to strengthen production capacity in South Korea. Together, the companies have pledged investments worth 3,200 trillion won (approximately $2.07 trillion) in semiconductor manufacturing facilities. Samsung expects to make its investment between 2026 and 2040, while SK Hynix has not disclosed a detailed implementation timeline.
To secure future sales, Samsung revealed earlier this year that it has entered into multi-year binding supply agreements with several customers seeking guaranteed access to memory chips, although the company has not disclosed the identities of these clients or the financial terms of the contracts.
Market forecasts remain optimistic for the coming months. Nomura expects commodity DRAM prices to increase by 24 per cent QoQ and NAND prices by 25 per cent during the July-September quarter, supported by continued demand from consumer electronics, traditional data centres, and AI infrastructure.
However, rising memory prices are also creating challenges for Samsung’s mobile business. Higher semiconductor costs have squeezed smartphone profit margins, with recent handset price increases proving insufficient to fully offset rising component expenses. Analysts believe Samsung may have to introduce further smartphone price hikes during the second half of the year, following similar pricing moves recently announced by Apple for its iPads and MacBooks.
Samsung is expected to announce its preliminary earnings shortly, while the company’s detailed financial results will be released later this month, offering investors a clearer picture of how the ongoing AI-driven semiconductor boom is reshaping the global technology industry.
