Samsung Electronics reported a jump in second-quarter operating profit, driven by strong demand for memory chips used in artificial intelligence systems. The South Korean company posted operating profit of 89.5 trillion won, or about $62 billion. That figure was up roughly 1,800% from the same period last year.
Revenue for the quarter came in at 171.5 trillion won, or around $118.7 billion. That marked a 130% increase from a year earlier. Net profit rose nearly 1,300% to 71.6 trillion won.
Both figures were close to what Samsung had forecast earlier this month. The results also topped estimates from analysts tracked by LSEG.
What Drove the Growth
Samsung said the gains came mainly from its memory chip business. Demand for AI servers pushed DRAM and NAND chip sales to record highs. These chips are used in phones, cars, and data center servers.
The company also scaled up sales of its HBM4 memory chip. It shipped the industry's first HBM4E samples to major customers during the quarter. HBM chips are used in AI processors, including hardware built by Nvidia.
Samsung raised spending on new factories to keep up with demand. This included work on a new plant in Pyeongtaek, South Korea. The company's first chip plant in Taylor, Texas, remains on track to start operations this year.
Samsung also finalized supply deals with five major data center customers. It said it is in late-stage talks with five more.
Stock Market Swings
The earnings landed after a rough week for South Korean chip stocks. On Wednesday, shares of Samsung and SK Hynix both dropped as traders sold off AI-related bets. Samsung fell more than 12%, while SK Hynix tumbled nearly 20%.
Samsung shares rose about 3% Thursday morning after the earnings report. But the stock later reversed course and closed 0.72% lower for the day.
SK Hynix also reported a record quarterly profit this week. However, its results missed analyst expectations.
Samsung said it expects the global memory chip shortage to get worse in 2027 and stay tight through 2028. The company pointed to growing AI infrastructure spending as the main driver.
Samsung's mobile division posted a loss of 700 billion won during the quarter. The company said rising component costs were the cause, even as phone sales grew.
Samsung denied recent reports that it is planning a U.S. stock listing. The company said it has no immediate need to raise capital given its cash position.
Over the weekend, Samsung announced a memory supply deal with Broadcom worth more than $200 billion over five years. The agreement covers HBM and other memory products for AI hardware.
South Korea's government has praised the chip sector's growth. Officials have confirmed plans for Samsung and SK Hynix to invest 800 trillion won in new chip plants at a site in Gwangju.
