Samsung Profit Set to Triple to Record High Amid AI-Driven Chip Boom

Samsung Electronics has projected a staggering three-fold increase in its fourth-quarter operating profit, marking a new record for the world’s largest memory chipmaker. The company estimates a profit of 20 trillion won ($13.82 billion) for October-December 2025, up from 6.49 trillion won a year earlier and surpassing analysts’ estimates of 18 trillion won. This growth reflects soaring prices for traditional memory chips driven by artificial intelligence (AI) demand and tight global supply.

The surge in chip prices is fueled by an unprecedented demand for memory used in servers, personal computers, and mobile devices to power AI applications. DRAM chips, a key type of memory, saw contract prices rise by 313% in the fourth quarter compared with the same period last year, according to market tracker TrendForce. Industry analysts predict that the DRAM market could more than double to $311 billion by 2026, highlighting the transformative impact of AI on the semiconductor sector.

Despite the record-breaking forecast, Samsung shares closed slightly down 1.6% after reaching a session high, reflecting profit-taking by investors. Over the past year, the company’s stock has surged 155%, demonstrating strong market confidence in its leadership in memory technology. The Q4 operating profit surpasses Samsung’s previous quarterly record of 17.6 trillion won set in 2018, emphasizing the exceptional nature of the current chip market.

Leading chipmakers globally, including South Korea’s SK Hynix and U.S.-based Micron Technology, are struggling to meet the spike in AI-driven demand and are investing heavily in new fabrication plants. Nvidia CEO Jensen Huang referred to this surge as the rise of “AI factories,” stating that demand for semiconductors is “really, really quite terrific” at the recent Consumer Electronics Show in Las Vegas. This trend is pushing manufacturers to expand capacity and innovate faster than ever.

The boom in memory chip prices, however, could create challenges for Samsung’s mobile division, where higher component costs might squeeze margins. Still, the company’s dominance in memory production positions it to capitalize on the ongoing AI revolution, underscoring how emerging technologies are reshaping the global semiconductor landscape and creating unprecedented opportunities for industry leaders.

source: reuters