Samsung Electronics sees robust AI demand after Q1 profit surges eightfold to set record
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
SEOUL, April 30 : Samsung Electronics on Thursday reported record quarterly profit after an eightfold jump in earnings, saying it expects the momentum to continue as clients spend aggressively on AI infrastructure and drive up prices of its memory chips.
A boom in the construction of AI data centres has spurred chipmakers to allocate more production capacity to advanced chips that Nvidia uses in its so-called AI accelerators, squeezing the supply of more conventional chips.
Samsung said it "expects server memory demand to remain strong as hyperscalers accommodate enterprises' increasing adoption of AI" and large language model services. It also expects agentic AI - AI that operates autonomously - "to accelerate growth in demand" in the second half of this year.
U.S. technology majors including Alphabet, Amazon and Microsoft on Wednesday signalled sustained AI spending.
CNA Games
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Show More
Show Less
Samsung, the world's top memory chipmaker by sales, said January-March operating profit in its cash cow chip division reached a record 53.7 trillion won ($36.15 billion) from 1.1 trillion won in the same period a year earlier.
That accounted for 94 per cent of the 57.2 trillion won quarterly total. That record total matched Samsung's 57.2 trillion won estimate and compared to 6.69 trillion won a year earlier.
Overall revenue rose 69 per cent on year to 133.9 trillion won.
NARROWING THE GAP WITH SK HYNIX
Samsung has been trying to narrow the gap with compatriot SK Hynix in supplying high bandwidth memory (HBM) chips to Nvidia, having fallen behind to the detriment of both profit and share price.
SK Hynix last week reported a quarterly profit record with a fivefold jump in earnings and forecast a prolonged chip industry boom, downplaying any concern about profit margins for chips nearing their peak.
On Thursday, Samsung said it has started the industry's first mass-production sales of HBM4 chips for Nvidia's Vera Rubin platform.
Shares of Samsung rose 1.3 per cent after the earnings announcement. The stock has surged 88 per cent this year, outstripping the broader market's 59 per cent gain.
Samsung also said profit in its mobile and network division declined 35 per cent in the first quarter to 2.8 trillion won, squeezed by surging prices of conventional chips.
The firm is bracing for potential production disruption as unions representing the majority of its workers in South Korea, especially in its chip division, consider striking over pay.
($1 = 1,485.4000 won)
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app