Samsung’s chip profit soars after AI fuels demand for memory

Samsung has been mobilizing its vast resources to better position itself in a fierce global contest where big spenders including OpenAI and Meta Platforms Inc. are amassing computing power for their AI services.

Samsung Electronics Co.’s semiconductor arm reported a stronger-than-expected rise in profit, suggesting global AI demand is helping drive a recovery at the Korean company’s most important business.

The unit, which competes with SK Hynix Inc. and US-based Micron Technology Inc., posted an operating profit of 7 trillion won ($4.9 billion) for the September quarter, compared with analysts’ average projection for 4.7 trillion won.

South Korea’s largest company, which reported upbeat preliminary operating profit and revenue earlier this month, said on Thursday net income totaled 12.01 trillion won, beating analysts’ estimate of 9.29 trillion won.

Samsung has been mobilizing its vast resources to better position itself in a fierce global contest where big spenders including OpenAI and Meta Platforms Inc. are amassing computing power for their AI services.

The memory chip business is a key pillar of Samsung’s empire, which spans smartphones and home appliances. But the company has ceded leadership in an arena where customers are willing to pay a premium for memory capacity that boosts artificial intelligence capabilities.

The spending spree is spilling over into demand for conventional memory products, where Samsung dominates. Its stock price is up about 90% since the start of the year, although shares of AI memory leader and home rival SK Hynix have more than tripled in the same period.

Investors are betting on Samsung’s chances of using its scale to gain ground in high-bandwidth memory. It reclaimed its spot as the top memory maker in terms of revenue in the third quarter after AI-related investments bolstered prices and sales volumes of general-purpose DRAM and NAND, according to Counterpoint.

The Suwon-based chipmaker recently secured an order from Advanced Micro Devices Inc. while awaiting final approval on HBM3E chips and next-generation HBM4 from Nvidia Corp., whose boss Jensen Huang is in South Korea this week. Samsung has also inked a deal to supply chips to OpenAI’s Stargate project.

“If you just look across the entire Korean ecosystem, every one of the companies are deep friends of mine and very good partners,” Huang told reporters during a company event in Washington earlier this week. “When I go, hopefully we’ll have some announcements that will be really, really delightful to the people of Korea and really delightful to President Trump.”