South Korean tech giant Samsung Electronics announced a significant surge in second-quarter operating profit, marking a 19-fold increase compared to the previous year. This growth was primarily driven by the high demand for memory chips utilized in AI data centers.
In 2026, Samsung and other major memory chip manufacturers experienced a notable rise in profits. However, concerns arose among investors regarding the possibility of the artificial intelligence sector being overvalued, leading to fluctuations in share prices.
Samsung reported an operating profit of 89.5 trillion won ($62 billion) for the April-June period, representing a remarkable year-on-year increase of over 1,800 percent. The company’s revenue also saw a substantial boost, reaching 171.5 trillion won, up by 130 percent from the previous year. Additionally, net profit surged by nearly 1,300 percent, totaling 71.6 trillion won.
Market expectations were met by these impressive figures, according to South Korea’s Yonhap news agency. However, on the previous day, South Korean stocks faced a sharp decline as investors reevaluated their AI-related investments, leading to concerns about the sustainability of high profit forecasts.
Following the market trend, Samsung’s shares dropped by more than 12 percent, while its domestic competitor SK hynix experienced a nearly 20 percent decline. Despite the significant year-on-year growth, SK hynix’s second-quarter operating profit and revenue fell short of expectations.
Samsung Electronics, SK hynix, and US-based Micron are the leading manufacturers of advanced high-bandwidth memory (HBM) chips crucial for AI processors. Samsung highlighted the success of its memory business, particularly in server products, achieving another record-breaking quarter.
The company expressed optimism about robust server demand in the latter half of 2026, driven by infrastructure investments and increased adoption of agentic AI technologies. Samsung also anticipates a deepening global memory chip shortage in 2027, expecting tight supply conditions through 2028.
Moreover, Samsung revealed plans for the commencement of operations at its first chip plant in Taylor, Texas, this year. Construction of a second facility is scheduled for later in 2026, aiming for mass production by 2030.
The expansion of AI technologies has positively impacted the prices and shipments of conventional NAND and DRAM memory chips, benefiting Samsung. Analysts noted that Samsung is leveraging its strong memory market position to expand its market share across various business segments.
In a strategic move, Samsung announced a collaboration with US chipmaker Broadcom to supply industry-leading memory solutions, including HBM, for next-generation AI accelerators. The partnership, estimated to exceed $200 billion over the next five years, aims to diversify Samsung’s AI memory customer base.
Rumors regarding a potential US listing by Samsung were dismissed by the company’s CFO, citing no immediate need for capital raising due to strong cash generation. The semiconductor boom has significantly boosted South Korea’s tax revenue, prompting plans for substantial investments in advanced chip fabrication plants in Gwangju.
President Lee Jae Myung described this period as a “golden window” for fresh investments, with Samsung and SK hynix expected to invest a combined 800 trillion won in the Gwangju fab project. However, analysts cautioned that the semiconductor supercycle may end before the completion of the project, posing a potential risk.
