Samsung Electronics announced a remarkable surge in operating profit, propelled by the proliferation of artificial intelligence (AI) technologies that have invigorated the computer memory chip markets.
The South Korean tech giant disclosed a tenfold increase in operating profit for the last quarter, reaching 6.6 trillion won ($4.8 billion), a stark contrast to the 640 billion won ($465 million) recorded during the corresponding period last year.
This surge in profit was accompanied by a robust revenue growth of nearly 13%, totaling 71.9 trillion won ($52 billion). The upswing was primarily fueled by elevated prices of memory chips and strong sales of its flagship Galaxy S24 smartphones.
Samsung’s semiconductor division notably rebounded, registering an operating profit of 1.91 trillion won ($1.38 billion), marking its first quarterly profit since the fourth quarter of 2022.
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This resurgence reflects the ongoing recovery of the chip market from the cyclical downturn exacerbated by the COVID-19 pandemic and global trade tensions. Samsung anticipates sustained strength in the memory chip market, driven by the proliferation of generative AI technologies.
These advancements are fostering demand for both traditional chips utilized in servers and cutting-edge chips tailored for AI processing, such as high-bandwidth memory (HBM). Samsung has already commenced mass production of its latest HBM chips, the 8-layer HBM3E, and plans to introduce the 12-layer version in the second quarter.
Looking ahead, Samsung foresees favorable business conditions in the latter half of 2024, with robust demand, particularly for generative AI applications, despite potential macroeconomic fluctuations and geopolitical uncertainties.
In smartphones, Samsung remains focused on enhancing the sales of its flagship Galaxy S24, equipped with an array of AI-driven features.
These include live translation during phone calls in multiple languages and dialects, showcasing Samsung’s commitment to integrating AI into its products to drive growth.
Furthermore, Samsung aims to expand AI capabilities beyond the Galaxy S24 to encompass its entire mobile device portfolio, anticipating that AI technologies will continue to propel growth in the smartphone market amid improving global consumer spending patterns.
