Samsung Forecast to Top 100 Trillion Won in Profit

According to a Reuters report on October 8, Samsung Electronics is expected to report quarterly operating profit exceeding 100 trillion won for the first time, marking a significant milestone for the global technology industry. Strong demand for AI chips has boosted memory semiconductor sales, with the company's third-quarter operating profit forecast to rise nearly ninefold year over year.

Samsung, the world's largest memory chip manufacturer, is expected to post operating profit of 107.4 trillion won for the July–September quarter, slightly above the 106.1 trillion won consensus estimate compiled by the London Stock Exchange Group's SmartEstimate. The company is also projected to record a 127% year-over-year increase in revenue to 195 trillion won.

Despite expectations of record earnings, Samsung's shares fell 0.2% in early trading, while South Korea's KOSPI index declined 0.5%. Investor concerns over the sustainability of the AI boom have weighed on market sentiment, with Samsung's share price down more than 25% from its record high in June.

Memory chip prices have risen for more than a year, driving record profit margins across major manufacturers, including Samsung Electronics, SK Hynix, and Micron Technology. However, investors are closely monitoring whether the current price rally can continue as supply conditions and market demand evolve.

AI Demand Drives Memory Semiconductor Growth

Samsung's anticipated profit surge is expected to be driven primarily by its memory semiconductor business. Tight supply of conventional DRAM and NAND flash memory, combined with growing demand for high-bandwidth memory (HBM), has supported substantial price increases across the memory market.

HBM has become a critical component in AI infrastructure because it enables high-speed data access for processors handling the intensive workloads associated with AI training and inference. As investment in AI data centers continues to support demand for advanced memory solutions, HBM has become an increasingly important growth driver for semiconductor manufacturers.

Nevertheless, rising memory chip prices are creating challenges for Samsung's other businesses. The company's smartphone and consumer electronics divisions are facing higher component costs, putting additional pressure on margins.

Analysts expect Samsung's mobile business to report a third-quarter loss exceeding $1 billion, worse than previously anticipated. Higher memory prices are increasing production costs for smartphones and other electronic devices, highlighting the challenges that rising semiconductor prices can create for downstream product manufacturers.

Foundry Business Faces Continued Challenges

Samsung's foundry business is also expected to remain loss-making in the third quarter. Analysts have cited high fixed costs and relatively low capacity utilization as key factors weighing on profitability.

However, stronger demand for advanced manufacturing processes could help improve capacity utilization over the coming quarters. Samsung continues to pursue its goal of narrowing the gap with Taiwan Semiconductor Manufacturing Company (TSMC) in advanced-node semiconductor manufacturing.

The company's ability to improve manufacturing yields, attract major customers, and increase production efficiency will remain important factors in its efforts to strengthen its position in the global foundry market.

Investors Await Detailed Earnings and Capital Return Plans

Samsung is scheduled to release its full third-quarter earnings report on October 29, providing a more detailed breakdown of performance across its business divisions. Investors will also be watching the company's earnings conference call later this month for further information about its shareholder return policy.

While strong AI-related demand is expected to support record earnings, Samsung's longer-term performance will also depend on memory pricing trends, smartphone profitability, and progress in advanced semiconductor manufacturing. These factors will help determine whether the current earnings momentum can be sustained in the coming quarters.