Samsung forecasts nearly nine-fold profit rise as AI memory demand lifts earnings

Samsung Electronics forecast third-quarter operating profit of 107.4 trillion won in Seoul on October 8, according to Reuters’ reporting of a regulatory filing, as demand for artificial intelligence infrastructure drove memory-chip earnings higher. The preliminary figure was nearly nine times the year-earlier result and exceeded analyst estimates, underscoring the strength of the memory boom.

The July–September forecast compares with operating profit of 12.17 trillion won a year earlier. Those figures imply an increase of approximately 782.5%. Revenue was projected to reach 195 trillion won, up 127% year on year, Reuters reported.

The profit forecast surpassed the LSEG SmartEstimate of 106.1 trillion won by 1.3 trillion won, or about 1.2%. Reuters described it as Samsung’s fourth consecutive quarterly operating-profit record. Detailed results, including earnings by business division, are expected later in October.

AI memory demand lifts Samsung’s forecast

Reuters’ report linked the earnings surge to AI infrastructure demand growing faster than memory supply. It described tight supplies of conventional DRAM and NAND chips alongside rising demand for high-bandwidth memory, or HBM, which is used to process large amounts of data for AI applications.

Samsung’s second-quarter results provide a baseline for the latest forecast. In its July 30 announcement, the company reported revenue of 171.5 trillion won and operating profit of 89.5 trillion won for the quarter ended June 30. Against those figures, the third-quarter forecast implies revenue growth of approximately 13.7% and operating-profit growth of 20%.

The company’s Device Solutions division reported second-quarter revenue of 127.5 trillion won and operating profit of 89.2 trillion won. That result demonstrates the semiconductor business’s importance to Samsung’s earnings before the latest forecast, although it does not establish the division’s third-quarter performance.

Slower memory price increases complicate the outlook

The strong annual comparison comes alongside signs that price increases could moderate. In a preview published before the announcement, Reuters reported that the LSEG estimate had fallen 7.7% since the end of August. That estimate incorporated 21 analysts and gave greater weight to those with stronger forecasting records.

The same Reuters preview cited TrendForce’s forecast that conventional DRAM contract prices would rise 10–15% quarter on quarter in the fourth quarter. That would be substantially slower than the approximately 60% increase reported for the second quarter. The forecast still pointed to rising prices, rather than a decline.

“Although the market remains in a tight supply position, the pace of price growth is expected to decelerate,” TrendForce research senior vice president Avril Wu told Reuters. She cited contractual price ceilings as a constraint: longer-term supply agreements exchange guaranteed supplies for limits on price increases.

SK Securities analyst Han Dong-hee estimated before the announcement that Samsung’s third-quarter memory operating margin would be 76%, unchanged from the preceding quarter, Reuters reported. That remains an analyst forecast, not a disclosed result. Reuters also reported that the won strengthened 14.3% against the dollar during the quarter, reducing the domestic-currency value of overseas earnings.

Chip gains and component costs affect different businesses

Samsung’s July release showed how higher component costs could weigh on other parts of the group. Its mobile and networks businesses reported a combined second-quarter operating loss of 0.7 trillion won on revenue of 33.2 trillion won. Samsung attributed weaker earnings to elevated component costs.

At that time, Samsung expected continued server-memory demand and supply constraints in the second half, despite some moderation in mobile and PC demand. The company also said it had increased HBM4 sales and shipped HBM4E samples to major customers. Those sample shipments did not establish commercial HBM4E production.

The detailed October results are expected to provide the divisional earnings breakdown missing from the preliminary announcement. Actual third-quarter memory margins and the relative contributions of prices, volumes and product mix remain unestablished in the current report. The forecasts for slower price increases and continued shortages describe expectations, rather than confirmed future outcomes.