Samsung shatters profit records as AI surge boosts chip demand
Samsung Electronics announced on Thursday that its operating profit for the last quarter achieved a record 107.4 trillion won, driven by a significant increase in demand for its computer memory chips utilised in artificial intelligence systems. Revenue for the July-September period increased to a historic peak of 195.3 trillion won, equivalent to USD 146 billion, signifying the company’s fourth consecutive quarter of record profit and revenue. Samsung’s regulatory filing followed closely on the heels of domestic competitor SK Hynix, which also announced record third-quarter profits. The two South Korean semiconductor leaders, commanding approximately two-thirds of the global memory market, are experiencing a robust demand for their chips, driven by the ongoing global AI surge.
Samsung indicated in a statement that it anticipates a surge in demand for its AI-related chips through 2027, outstripping supply as clients hasten to enhance their AI infrastructure. The company stated its intention to concentrate on the provision of advanced memory chips and storage products utilised in AI servers, encompassing high-bandwidth memory chips, server DRAMs, and solid-state drives. South Korean tech companies are significantly investing in semiconductor manufacturing facilities and data centers as the nation broadens its AI aspirations.
Samsung and SK Hynix in June announced plans to invest a combined 800 trillion won in a new chipmaking hub in the country’s southwest to capitalise on AI-driven demand. However, certain analysts express scepticism regarding the potential returns on this spending, while South Korea’s central bank has cautioned that the nation’s trade-dependent economy is increasingly dependent on chips, a situation that could exacerbate the adverse effects of any downturn related to AI.
