Samsung Electronics is riding high on the AI wave, with profits surging sixfold in the latest quarter.
The tech giant is now doubling down on production to meet the insatiable appetite for AI processing power.
Samsung Electronics earnings call
Samsung Electronics’ quarter earnings call (for June) shows a whopping six-fold increase in net income. The tech behemoth raked in 9.64 trillion won (approx ZAR131.94 billion, and USD$6.96 billion), leaving analysts’ predictions in the dust.
Daniel Oh, Head of Investor Relations, said about Memory: Samsung Electronics “continued proactive investments to meet the demand for high value-added products such as HBM and DDR5 along with ongoing investment in R&D and back end to enhance future competitiveness.”
Next in the presentation was Jaejune Kim from Memory Global Sales and Marketing, who says, “even though the range of market price increased by each application is forecasted to be decoupled, the environment Memory business is projected to remain positive.”
Samsung Electronics foresees “a solid server demand led by generative AI to lead the strengths,” Kim added. “Therefore, we also plan to actively respond to the demand for high value-added products for AI in the second half.”
What’s behind this epic profit surge?
Two words: AI chips.
AI chip gamble pays off big time
Samsung Electronics’ semiconductor unit is the star of the show, pulling in a cool 6.45 trillion won in operating profit.
High-bandwidth memory (HBM) chips, the unsung heroes powering AI’s insatiable appetite for data, saw sales jump over 50% from the previous quarter.
But Samsung’s not resting on its laurels.
The company plans to double its output of these high-end chips next year, betting big on the AI boom’s staying power.
And…. It’s not just about chips, either.
Galactic highs
The Galaxy S24’s stellar performance boosted sales across the board, from camera sensors to displays.
That’s because, according to Oh, the tech giant “persistently broadened the application of recycled materials in [its] newest products.”
“[This] is exemplified by the incorporation of nine recycled materials in the Samsung Galaxy Z Fold 6 and Z Fold Flip 6 Series, reflecting a substantial increase from the poor materials utilized in the proceeding series.”
Either way, Samsung’s sitting pretty on a cash pile of over 100 trillion won. The company’s not shy about splashing the cash either, with R&D expenses hitting a new high of 8 trillion won in the June quarter.
In the world of tech, the chips are up.
And Samsung’s playing to win.
