Samsung’s Chip Business Hits Record as AI Demand Tightens Memory Supply

Samsung Electronics posted a stunning first-quarter operating profit that surged more than eight-fold year over year, beating analyst expectations and setting a new record. The South Korean tech giant reported operating profit of 57. 2 trillion Korean won on revenue of 133. 9 trillion won—both well above consensus estimates.

The profit jump of over 750% from the same period last year was driven almost entirely by its chip division, which saw operating profit soar from roughly 1 trillion won to 53. 7 trillion won. Chip revenue climbed 225% to 81. 7 trillion won, fueled by the global AI data center buildout.

Memory chip prices have risen sharply as manufacturers prioritize high-bandwidth memory (HBM) for AI workloads, squeezing supply for consumer electronics like smartphones and PCs. Samsung noted that server memory demand should stay strong through the second half of 2025, as hyperscale cloud providers ramp up AI adoption. The company is making strides in HBM4, the latest generation of memory technology, having started shipping samples earlier this year. Still, it trails rival SK Hynix, which commanded 57% of HBM revenue in Q4 2024, according to Counterpoint Research.

Analysts say the gap is narrowing, but Samsung has work ahead to reclaim the lead in this lucrative market.

Source: CNBC