Samsung’s profit soars tenfold on AI-driven chip market rebound

Samsung Electronics announced a significant rise in operating profit for the January-March quarter, with a tenfold increase driven by the expanding role of artificial intelligence technologies in boosting the computer memory chip market.

The tech giant, a leader in semiconductors and smartphones, reported an operating profit of 6.6 trillion won ($4.8 billion), a sharp increase from the 640 billion won ($465 million) reported in the same period the previous year.

Revenue also climbed by nearly 13% to 71.9 trillion won ($52 billion), fueled by higher memory chip prices and strong sales of its latest flagship smartphone, the Galaxy S24.

Samsung’s semiconductor division, in particular, saw its first quarterly profit since late 2022, earning 1.91 trillion won ($1.38 billion). This recovery follows a downturn caused by the COVID-19 pandemic and global trade tensions.

Looking ahead, Samsung expects the demand for memory chips to remain robust, particularly due to the growth of generative AI technologies, which require advanced chips for processing, including high-bandwidth memory (HBM).

To meet this surging demand, Samsung has begun mass production of its new 8-layer HBM3E chips this month and plans to introduce a 12-layer version in the second quarter.

The company anticipates positive business conditions for the latter half of 2024, supported by strong AI-driven demand, although it remains cautious about ongoing macroeconomic uncertainties and geopolitical tensions.

In the smartphone sector, Samsung will concentrate on enhancing sales of the Galaxy S24, which features AI-driven capabilities such as live translation for phone calls in multiple languages and dialects.

Furthermore, Samsung intends to broaden the integration of AI features across its mobile device lineup, expecting that these advancements will stimulate growth in the smartphone market amid an improving global economic climate.