Samsung profit jumps 780% to 107.4 trillion won, shares drop 5%
Samsung Electronics posted a record quarterly operating profit of 107.4 trillion won ($80.5 billion) on booming AI memory chip sales, yet its shares dropped more than 5% as chip-unit results missed estimates.
The South Korean electronics maker became the first technology firm to clear the 100-trillion-won threshold for quarterly operating income during the July-to-September period, the company confirmed. Net income climbed more than 510% from the prior year to 75.1 trillion won, while revenue totaled 195.3 trillion won.
The surge in profit reflects a boom in data-center construction aimed at powering chatbots and other artificial intelligence tools, a trend lifting chip manufacturers industry-wide even as doubts linger about whether current AI spending can be sustained. Samsung credited its memory chip division for another record performance, pointing to a shift toward AI-focused products and higher pricing for server-grade components amid constrained supply.
Despite the blockbuster results, Samsung shares fell more than 5% during Thursday’s session after the semiconductor unit’s earnings came in below what analysts had projected. Pepperstone strategist Dilin Wu observed that the solid results posted by both Samsung and SK hynix underscore the continued momentum of the AI-driven memory cycle, even as skepticism around broader AI investment trends persists.
Samsung finance chief Park Soon-cheol said the company expects memory demand to grow at an unprecedented pace through 2027, as competitors scramble to expand AI infrastructure, and cautioned that supply would likely stay tight since building new production capacity takes time. The industry’s growing focus on high-bandwidth memory has also tightened availability of conventional memory chips used in everyday devices.
Alongside the earnings report, Samsung reiterated an August pledge to return as much as 110 trillion won to shareholders this year, including 30 trillion won in cash dividends. Rival SK hynix separately unveiled a new 60-trillion-won shareholder return plan after concluding an earlier 40-trillion-won program. KB Securities research head Kim Dong-won said larger payouts could help close what he views as a valuation gap in Samsung’s share price.
Why it matters for markets: The Samsung record profit and the market’s negative reaction show how AI-driven chip demand is reshaping earnings expectations and valuations across tech-heavy indices such as the Nasdaq 100 and major Asian benchmarks. Shifts in memory chip supply and pricing also affect consumer electronics costs, global trade patterns, and corporate profit margins.
Source: Economic Times Markets