Samsung's Q2 Profit Jumps 19-Fold as AI Memory Chip Demand Drives Record Revenue

Samsung Electronics reported record second-quarter revenue on Thursday as booming demand for artificial intelligence (AI) memory chips helped drive a sharp rise in earnings. The South Korean technology giant said operating profit increased more than 19-fold from a year earlier, supported by the strong performance of its semiconductor business.

The company posted revenue of 171.5 trillion won ($119 billion) for the April-June quarter, its highest ever for a second quarter. Operating profit stood at 89.5 trillion won ($62 billion), according to the company.

Samsung said demand for memory products is expected to remain strong in the second half of the year as investments in AI infrastructure continue and the adoption of agentic AI expands. It also expects the memory chip market to remain undersupplied because of growing demand for server chips.

AI Memory Chips Drive Earnings Growth

Samsung said its semiconductor division was the biggest contributor to quarterly earnings, benefiting from higher memory chip prices and increased shipments of advanced high-bandwidth memory (HBM) chips used in AI applications.

The strong chip business helped offset losses in its mobile, television and home appliances division, where rising component costs continued to weigh on profitability.

The results come amid continued strong demand for AI hardware, with technology companies investing heavily in servers and data centres to support AI applications.

SK Hynix Also Benefits From AI Boom

Samsung's earnings were announced a day after rival SK Hynix reported record quarterly revenue of 60.5 trillion won ($42 billion). However, the company's profit fell short of market expectations, and its shares declined more than 9% on Wednesday, according to AP.

Together, Samsung and SK Hynix produce about two-thirds of the world's memory chips, making both companies key beneficiaries of the AI-driven surge in semiconductor demand.

However, shares of both chipmakers have remained under pressure this week as investors raised concerns over their aggressive expansion plans and the possibility of increased competition from Chinese semiconductor companies.

China Competition, Expansion in Focus

Shares of Samsung and SK Hynix have remained under pressure this week amid concerns over increasing competition from China. Reports have suggested that a state-owned Beijing company has commenced mass production of advanced immersion deep-ultraviolet (DUV) lithography machines domestically. The strong stock market debut of Chinese memory chipmaker ChangXin Memory Technologies has also remained in focus.

According to reports, Samsung and SK Hynix together produce roughly two-thirds of the world's memory chips. The two companies have also announced plans for major investments in semiconductor manufacturing facilities and data centres to support growing AI-driven demand.

Last month, Samsung and SK Hynix announced plans to invest a combined 800 trillion won ($554 billion) in a new chipmaking hub in South Korea's southwest to capitalise on rising AI-driven demand.