Samsung Electronics is set to report a nearly nine-fold jump in third-quarter operating profit after strong demand for artificial intelligence chips drove a surge in memory earnings.
The world’s largest memory chipmaker estimated operating profit at 107.4 trillion won (US$80.17 billion) for the July-September quarter, beating the LSEG SmartEstimate of 106.1 trillion won, according to a regulatory filing.
The result would mark Samsung’s fourth consecutive quarter of record operating profit, up from 12.17 trillion won a year earlier, as demand for AI infrastructure continues to outpace growth in memory chip supply.
Third-quarter revenue is expected to rise 127 per cent year on year to 195 trillion won, Samsung said.
The company will release its detailed results, including earnings by business division, on Oct 29.
Memory chips are expected to account for most of the earnings improvement, with analysts expecting the supply-demand imbalance to persist and potentially widen in 2027 as AI-related demand takes up a larger share of global memory capacity.
Prices have risen sharply amid tight supplies of conventional DRAM and NAND chips, alongside growing demand for high-bandwidth memory (HBM) used in AI applications.
Conventional DRAM bit shipments are expected to remain broadly flat due to limited inventories, while HBM shipments could increase sharply from the previous quarter on strong demand for HBM4, analysts said.
Douglas Kim of Douglas Research Advisory estimated that Samsung’s HBM bit shipments increased by close to 50 per cent quarter-on-quarter in the third quarter.
However, the stronger South Korean won may have offset some of the gains by reducing the value of overseas sales denominated in US dollars when converted into local currency.
The memory chip boom also poses challenges for Samsung’s smartphone and consumer electronics businesses as higher component costs put pressure on margins.
While higher memory prices are benefiting its semiconductor business, they are also increasing costs for Samsung’s smartphones and other electronic devices.
Reuters
