Samsung's Profit Soars 18-Fold on AI Chip Boom, Not Smartphone Sales

Samsung Electronics’ operating profit is projected to surge more than 18-fold in the April-June 2026 period, driven by soaring memory chip prices rather than its smartphone business. According to a Reuters report citing 30 analysts polled by LSEG SmartEstimate, profit is expected to exceed 86 trillion won, compared to 4.7 trillion won recorded in the same period last year.

The surge is fuelled by skyrocketing chip prices amid high demand from AI technology infrastructure. Samsung is the world’s largest chipmaker. Analysts predict the supply shortage in the memory market will persist until 2027.

Chip manufacturers like Samsung are receiving a flood of orders not only for high-bandwidth memory chips used in AI servers but also for conventional DRAM and NAND chips. This is driven by the increasing adoption of agentic AI applications, which require additional memory and higher storage capacity to handle complex, multi-stage computing tasks. Samsung is a key supplier for global tech companies such as Nvidia, Google, and Apple. Citi Research noted that average DRAM and NAND prices jumped 44 percent and 53 percent, respectively, in the last quarter.

Conversely, Samsung’s mobile business is facing cost pressures from rising chip prices. Profit margins in the smartphone market are thinning because component costs are rising much faster than handset prices. Samsung has attempted to mitigate this impact by increasing the price of its smartphones, but analysts expect the world’s largest phone maker will need to implement further price hikes in the second half of 2026.