Samsung Electronics is poised to deliver one of the most dramatic earnings surges in its history, with first-quarter profit expected to surpass what it made in the whole of last year, driven by soaring demand for artificial intelligence chips.
The company, which is the world’s largest memory chipmaker, forecast operating profit of about 57.2 trillion won ($37.9 billion) for the January to March period, an increase of more than eightfold from a year earlier. The figure also comfortably beats analyst expectations and marks a record-breaking quarterly performance for the company.
The surge reflects the extraordinary momentum of the AI boom, which has transformed the global semiconductor market. Demand for chips used in AI data centres has stretched supply chains and pushed prices sharply higher. Memory chips (particularly DRAM, which is essential for AI workloads) have seen significant price increases, with some estimates suggesting contract prices could rise by more than 50% in the current quarter.
This imbalance between supply and demand has been a key driver of Samsung’s windfall. As hyperscalers and tech firms ramp up spending on AI infrastructure, they are snapping up memory chips at a pace that has outstripped production capacity. That dynamic has not only lifted volumes but also allowed chipmakers to command higher prices, amplifying profit growth.
Currency movements have provided an additional tailwind. A weakening South Korean won, hovering near a 17-year low against the US dollar, has boosted the value of overseas earnings when converted back into local currency, further inflating reported profits.
Samsung’s semiconductor division is expected to account for the vast majority of earnings, contributing roughly 54 trillion won in operating profit. However, not all parts of the business are benefiting equally. The company’s logic chip, or foundry, segment is still projected to post losses, highlighting ongoing challenges in competing with rivals in advanced chip manufacturing.
Its mobile division, meanwhile, has delivered relatively steady performance, generating around 4 trillion won in profit. This has been supported in part by the use of lower-cost component inventories, though analysts warn that rising chip prices could squeeze margins in the coming quarters.
Despite the strong headline numbers, questions remain about how long the current boom can last. Analysts are beginning to flag early signs that the sharp rise in memory prices may be nearing its peak, with some indicators pointing to softening demand at elevated price levels.
Geopolitical risks also loom large. Rising energy costs linked to tensions in the Middle East, along with potential disruptions to key materials used in chipmaking, could weigh on future growth. At the same time, emerging technologies designed to reduce memory usage in AI systems could eventually dampen demand.
For now, Samsung stands as one of the clearest beneficiaries of the AI-driven semiconductor supercycle, delivering record profits that show just how transformative the technology shift has become.
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Emmanuel Abara Benson is a business journalist and editor covering artificial intelligence, global markets, and emerging technology.
He has previously worked with Business Insider Africa and Nairametrics, reporting on finance, startups, and innovation.
His work focuses on AI, digital economy, and global tech trends.
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