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🇰🇷 South Korea /Economy & Trade

Samsung Electronics' Q1 Profit Skyrockets to Record $57 Billion, Outpacing Global Tech Giants

From Hankyoreh · (5m ago) Korean Positive tone

Translated from Korean, summarized and contextualized by DistantNews.

TLDR

  • Samsung Electronics reported a record-high first-quarter operating profit of 57.23 trillion won, a 756.1% increase year-on-year.
  • The semiconductor division was the primary driver, achieving an operating profit of 53.7 trillion won, surpassing global tech giants like Microsoft, Amazon, and Meta.
  • This surge is attributed to soaring memory chip prices, driven by massive investments in AI infrastructure, with Samsung forecasting continued demand through next year.

Samsung Electronics has once again demonstrated its dominance in the global technology landscape, posting staggering first-quarter results that have left competitors in the dust. The company's operating profit soared to a record 57.23 trillion won, a remarkable 756.1% jump from the previous year. This phenomenal performance was overwhelmingly powered by its semiconductor division, which alone generated an operating profit of 53.7 trillion won. This figure not only solidifies Samsung's position as a leader in memory chips but also outshines the quarterly earnings of tech behemoths like Microsoft, Amazon, and Meta.

The driving force behind this semiconductor boom is the insatiable demand for Artificial Intelligence (AI) infrastructure. Global tech giants are pouring trillions of won into AI, creating an unprecedented surge in the need for high-performance memory chips like DRAM and NAND flash. Samsung, with its vast production capacity and advanced technology, is perfectly positioned to capitalize on this trend. The company's memory chip prices have reportedly skyrocketed, with its semiconductor division boasting an operating profit margin of a remarkable 66% in the first quarter.

While the semiconductor division shines, other sectors within Samsung, such as smartphones, home appliances, and displays, saw a decline in operating profit compared to the previous year. This highlights a growing "profit concentration" within the semiconductor business. However, Samsung remains optimistic, with executives predicting that the demand for AI memory, particularly its cutting-edge High Bandwidth Memory (HBM), will continue to grow exponentially. The company anticipates its HBM sales to more than triple this year, with its latest 6th-generation product expected to account for over half of its HBM sales. This strategic focus on AI-driven memory solutions positions Samsung for continued success in the foreseeable future, even as the broader tech market navigates evolving trends.

This year's volume is already sold out. Next year, the gap between supply and demand will widen even more than this year.

— Kim Jae-joon, Vice President of Samsung Electronics Memory DivisionDuring a earnings call, explaining the strong demand and outlook for memory chips.
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Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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