Samsung posts record profit as AI chip boom drives 19-fold surge

Samsung Electronics reported a 19-fold jump in second-quarter operating profit to 89.4 trillion won ($58.4 billion), its third consecutive record, driven by surging demand for AI memory chips Source: BBC. The preliminary results, released on July 7, showed revenue of 171 trillion won, more than double the same period last year, but slightly below analyst forecasts Source: CNBC.

What drove the boom

AI server demand has pushed memory prices to record highs. According to Citi Research, DRAM contract prices rose 44% quarter-on-quarter and NAND flash 53% Source: Euronews. Samsung's Device Solutions division expects its 2026 operating profit to exceed the cumulative profit from its entire 40-year chip history Source: Tom's Hardware.

Market reaction

Despite the stellar earnings, Samsung shares fell nearly 7% on Tuesday, wiping out over $100 billion in market value Source: Euronews. The decline reflects profit-taking after a rally that had already priced in the strong results, as well as concerns about the sustainability of AI infrastructure spending Source: CNBC. Analysts noted that the slight revenue miss and fears of a peak in the memory cycle spooked investors Source: Euronews.

What's next

Samsung's full results, with divisional breakdown, are due on July 30 Source: CNBC. The company has warned of tight chip supply through at least 2027 Source: Tom's Hardware. Meanwhile, rival SK Hynix is launching a $28 billion U.S. listing, testing investor appetite for AI stocks Source: AP News.