BY EMMANUEL OGBONNA
Samsung Electronics is expected to report another record-breaking quarter, with soaring demand for artificial intelligence technology fueling an unprecedented surge in memory chip sales and significantly boosting the company’s earnings.
The South Korean technology giant, the world’s largest producer of memory chips, is forecast to announce on Tuesday that its operating profit for the April-to-June quarter climbed nearly 18 times compared with the same period last year, underscoring the powerful impact of the global AI revolution on the semiconductor industry.
According to estimates compiled from leading market analysts, Samsung is expected to post an operating profit of approximately 8.6 trillion won (about $56.35 billion), a dramatic increase from 4.7 trillion won recorded during the same quarter a year earlier.
If confirmed, the results would mark Samsung’s third consecutive quarter of record operating profit, highlighting the company’s strong position at the center of the rapidly expanding artificial intelligence supply chain.
The remarkable earnings growth has been fueled by a continuing shortage of memory chips across global markets. Demand for advanced memory products used in AI servers and data centers has continued to outpace manufacturing capacity, allowing chipmakers to charge significantly higher prices.
Industry analysts expect supply constraints to continue through at least next year as technology companies around the world invest heavily in artificial intelligence infrastructure, cloud computing, and next-generation data centers.
Although high-bandwidth memory (HBM) has attracted significant attention because of its critical role in powering advanced AI processors, analysts say strong demand has expanded well beyond specialized products.
Traditional DRAM memory chips and NAND flash storage products have also experienced sharp increases in demand as artificial intelligence applications become increasingly integrated into businesses, cloud services, enterprise computing, and consumer technology.
One of the fastest-growing trends driving this expansion is the emergence of agentic AI, a new generation of artificial intelligence systems capable of carrying out complex, multi-step tasks with minimal human intervention.
Unlike earlier AI models that primarily focused on training large language models using enormous datasets, agentic AI systems continuously process information, make decisions, retrieve stored data, and execute multiple operations simultaneously. These advanced capabilities require substantially larger amounts of memory and storage, increasing demand for both DRAM and NAND products across the industry.
As one of the world’s leading memory chip manufacturers, Samsung supplies semiconductor products to many of the technology sector’s biggest names, including Nvidia, Google, and Apple, all of which continue investing billions of dollars to expand artificial intelligence services and cloud infrastructure.
Market research indicates memory prices continued climbing sharply during the second quarter. Analysts estimate that average selling prices for DRAM increased by approximately 44% compared with the previous quarter, while NAND flash prices rose by around 53% during the same period.
The combination of higher prices and strong customer demand has fueled one of the semiconductor industry’s biggest stock market rallies in recent years.
Samsung shares have climbed roughly 158% this year, while fellow South Korean memory producer SK Hynix has surged approximately 273%. U.S.-based memory manufacturer Micron Technology has also recorded gains exceeding 240%, reflecting investor optimism that the artificial intelligence boom will continue generating exceptional profits across the semiconductor sector.
The rally has pushed the market valuations of all three companies above the $1 trillion mark, highlighting the enormous value investors now place on businesses supplying critical AI hardware.
Despite the overwhelmingly positive outlook, analysts caution that Samsung’s reported earnings could still fall slightly below market expectations because of accounting provisions related to employee bonuses.
Earlier this year, Samsung reached a wage agreement with employees in its semiconductor division, avoiding the possibility of a large-scale labor strike. Under the agreement, workers will receive special performance bonuses linked to the division’s profitability.
Some analysts estimate Samsung may eventually recognize bonus provisions totaling more than 40 trillion won, although the timing of those accounting charges remains uncertain and could influence the company’s reported quarterly profit.
Samsung is expected to release its preliminary earnings guidance this week before publishing its complete financial results later this month.
Looking beyond the current quarter, analysts believe the biggest challenge facing Samsung and the broader semiconductor industry will be maintaining the extraordinary pace of artificial intelligence investment.
While demand for AI infrastructure remains exceptionally strong, some investors have begun questioning whether technology companies can continue increasing spending indefinitely.
Industry analysts note that memory chips are consuming an increasingly large share of cloud computing companies’ capital expenditure budgets. Estimates suggest AI memory accounts for roughly 52% of cloud infrastructure investment this year and could exceed 70% next year if current trends continue.
Some market observers have raised concerns that spending growth may eventually slow if artificial intelligence services fail to generate sufficient commercial returns.
Major cloud providers and technology companies are under growing pressure to demonstrate that their massive investments in AI infrastructure will translate into stronger revenue growth, improved profitability, and broader adoption of artificial intelligence across businesses and consumers.
Samsung and SK Hynix have nevertheless signaled confidence in long-term demand by announcing ambitious investment plans to expand semiconductor manufacturing capacity in South Korea.
Together, the two companies have pledged investments totaling approximately 3,200 trillion won to strengthen domestic chip production. Samsung plans to carry out its investment program between 2026 and 2040, while SK Hynix has not yet announced a detailed timeline for its own expansion plans.
To secure future supply commitments, Samsung disclosed earlier this year that it has signed multiple long-term contracts with major customers seeking guaranteed access to memory chips as shortages continue across global markets. The company has not revealed the identities of those customers or the financial terms of the agreements.
Market forecasts remain optimistic for the months ahead. Analysts expect prices for standard DRAM memory chips to rise by approximately 24% during the July-to-September quarter, while NAND flash prices could increase another 25%, supported by continued growth in consumer electronics, enterprise storage systems, traditional data centers, and artificial intelligence infrastructure.
However, rising memory prices are creating new challenges for Samsung’s own smartphone business.
As the cost of memory components continues increasing, profit margins for Samsung’s mobile division have come under pressure despite recent price increases for its smartphones. Analysts believe higher production costs have largely offset those price adjustments, reducing profitability in the handset business.
Industry experts now expect Samsung may need to introduce additional smartphone price increases during the second half of the year if memory costs continue climbing. Competitor Apple has already raised prices for several products, including its iPads and MacBooks, reflecting broader cost pressures across the global technology industry.
With artificial intelligence continuing to reshape the semiconductor market, Samsung’s upcoming earnings report is expected to provide one of the clearest indications yet of how strongly the AI investment boom is transforming the financial performance of the world’s largest chip manufacturers.
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