Samsung Q2 operating profit jumps over 1,800% on AI demand

Samsung Electronics said its second-quarter operating profit rose more than 1,800% from a year earlier to 89.5 trillion won, or $62 billion, as demand for memory chips used in artificial intelligence data centres supported its results.

The South Korean technology company reported April-to-June revenue of 171.5 trillion won, up 130% from a year earlier. Net profit rose nearly 1,300% to 71.6 trillion won.

South Korea's Yonhap news agency said the figures met market expectations, citing its own financial data firm.

Samsung, SK hynix and US firm Micron are among the world's biggest makers of advanced high-bandwidth memory chips, which are used in AI processors. Samsung said its memory business achieved another record quarter, with a main focus on server products.

Samsung said it expects robust server demand in the second half of 2026, driven by infrastructure spending and wider adoption of agentic AI, systems that can perform tasks for users. Chief financial officer Park Soon-cheol told an earnings call that Samsung expects a global memory chip shortage to deepen in 2027 and remain tight through 2028.

The results came after a sell-off in South Korean AI-linked chip stocks. On Wednesday, Samsung shares fell more than 12%, while domestic rival SK hynix fell nearly 20% after a 14% fall the previous day. Samsung shares were up about 3% on Thursday morning after two straight days of losses.

SK hynix reported second-quarter operating profit and revenue on Wednesday that AFP said came in below expectations, despite large increases from a year earlier.

Samsung said its first chip plant in Taylor, Texas, remains on track to begin operations this year. It said construction of a second facility is planned for later in 2026, with mass production targeted for 2030.

Over the weekend, Samsung announced a strategic collaboration to supply memory solutions, including HBM, to support US chipmaker Broadcom's next-generation AI accelerators. AFP reported that the partnership is estimated to exceed $200 billion over the next five years through 2030.

Joo Won, head of Hyundai Research Institute's economic research division, said the Broadcom move could be seen as Samsung seeking an AI memory customer base beyond Nvidia, which has long relied on SK hynix for HBM.

Park dismissed rumours that Samsung could pursue a US listing after SK hynix's $26.5 billion offering, saying the company has "no immediate need" to raise capital because of strong cash generation.

Seoul has confirmed plans for Samsung and SK hynix to invest a combined 800 trillion won in four advanced chip fabrication plants at a former military airport site in Gwangju. Joo said the Gwangju project would take considerable time and warned that the semiconductor cycle could weaken before it is ready.