Samsung forecasts record quarterly profit, beating estimates on AI memory demand

SEOUL, July 7 : Samsung Electronics on Tuesday forecast a 19-fold jump in second-quarter operating profit from a year earlier, its third consecutive quarter of record operating profit, as AI-driven demand continued to boost memory chip prices. The world's largest memory chipmaker estimated April-June operating profit at 89.4 trillion won ($58.44 billion), beating an LSEG SmartEstimate of 87.3 trillion won, according to a regulatory filing. It reported a profit of 4.7 trillion won a year earlier. The figure surpassed Samsung's combined operating profit for the three years from 2023 through 2025. Revenue would likely rise 129 per cent to 171 trillion won from a year earlier, it said. Memory prices continued to climb during the quarter as AI spending broadened beyond high-bandwidth memory (HBM) into conventional DRAM and NAND products. Analysts said rapid growth in HBM production has tightened supply of conventional memory products used in smartphones, PCs and enterprise servers, further supporting prices. Citi Research last week said average selling prices for DRAM and NAND rose 44 per cent and 53 per cent quarter-on-quarter, respectively, in the second quarter. Analysts also said customers are increasingly seeking longer-term supply agreements, reinforcing expectations that memory prices will remain elevated for longer and benefiting manufacturers such as Samsung with large-scale production capacity. While Samsung's memory business is expected to post another quarter of strong earnings, analysts said losses at its foundry and logic chip (LSI) businesses are likely to widen because bonus expenses are allocated across the semiconductor division. Samsung in May agreed a pay deal with workers across its chips division that would link their performance bonuses to operating profit. Samsung said it plans to announce detailed results on July 30, including a breakdown of earnings of each of its business divisions. ($1 = 1,529.8100 won)