Samsung Electronics expects third-quarter operating profit to reach $80.17 bn, nearly nine times the level recorded a year earlier. The forecast would make Samsung the first technology company worldwide to report quarterly operating profit exceeding 100tn won, supported by surging AI chip demand and rising memory prices.
The world’s largest memory chip manufacturer projected earnings above the LSEG SmartEstimate consensus of 106.1tn won for July through September. Samsung also expects quarterly revenue to climb 127% year-over-year to 195tn won.
The figures would extend Samsung’s record-breaking earnings streak to four consecutive quarters. Global investment in AI infrastructure continues to absorb memory chip supplies faster than manufacturers expand production capacity. Tight inventories have pushed prices sharply higher, giving major producers exceptional pricing power.
Samsung and US rival Micron expect memory supply constraints to continue into 2028. The longer-term outlook remains uncertain, with Chinese manufacturers expanding their competitive presence and investors questioning whether AI infrastructure spending will maintain its current pace.
Samsung shares showed little reaction to the earnings forecast. The stock declined 0.2% in early trading, compared with a 0.5% drop in South Korea’s KOSPI index.
Investors remain cautious after Samsung’s shares lost more than 25% from their June record high amid doubts about the sustainability of AI-related demand.
Currency movements have added pressure to earnings expectations. The South Korean won has strengthened considerably against the US dollar, reducing the reported value of Samsung’s dollar-denominated international sales. Analysts have consequently revised some of their profit forecasts downward.
Kim Seok-hwan, a market analyst at Mirae Asset Securities, said investors have shifted their attention toward the sustainability of the rapid earnings expansion beginning a year earlier. Another record quarter isn’t enough to settle concerns about the next stage of the memory chip cycle.
Memory chip prices show signs of slower growth
Analysts forecast Samsung’s fourth-quarter operating profit will increase 8.2% sequentially, compared with estimated growth of 20% in the third quarter. The expected slowdown follows early indications of softer memory price increases after more than a year of exceptional gains.
Research firm TrendForce predicts conventional DRAM contract prices will increase between 10% and 15% during the fourth quarter. The estimate represents a marked slowdown from the roughly 60% price surge recorded in the second quarter.
Memory pricing remains central to investor expectations. Samsung, SK Hynix and Micron have benefited from an extended supply shortage, with profit margins reaching record levels. Gross margins among leading memory producers have exceeded 80% as AI-related chip demand continues to exceed available supply.
A slower rate of price increases would affect earnings growth even if overall demand remains strong. Investors are therefore examining the durability of current margins rather than focusing exclusively on quarterly profit records.
Conventional DRAM and NAND chips remain in tight supply. At the same time, manufacturers face growing orders for high-bandwidth memory (HBM), used to process large volumes of data in AI computing systems.
These pressures have lifted prices across several memory categories. For Samsung, memory chips are expected to contribute most of the third-quarter earnings improvement.
Douglas Kim of Douglas Research Advisory estimates Samsung’s HBM bit shipments increased nearly 50% quarter-over-quarter during the July–September period. Samsung has been expanding HBM production as it attempts to narrow SK Hynix’s lead in the market for advanced AI memory.
Stronger HBM shipments would give Samsung greater exposure to demand from AI computing infrastructure. Yet volume growth alone doesn’t resolve investor concerns about future pricing, especially as competing manufacturers invest in additional production capacity.
Samsung’s mobile business faces losses from rising chip costs
The memory shortage has created a difficult situation inside Samsung itself. Higher chip prices support the company’s semiconductor earnings, but those same costs squeeze profitability across its smartphone and consumer electronics operations.
Analysts estimate Samsung’s mobile division recorded a third-quarter loss exceeding $1bn, larger than previously expected. Rising component expenses have increased pressure on a business already operating in a competitive smartphone market.
The contrasting performance exposes an unusual financial divide within Samsung. Its memory operations benefit directly from supply shortages, whereas the company’s device divisions absorb higher procurement costs.
Samsung’s contract chip manufacturing operation faces separate financial difficulties. Analysts expect the foundry division to remain unprofitable, citing substantial fixed expenses and relatively low factory utilisation rates. These costs continue to weigh on the business despite the wider semiconductor industry’s strong AI-related demand.
