Samsung Electronics reported a record second-quarter operating profit of 89.5 trillion won, up 1,814% year on year, driven by AI chip demand — and warned that memory supply constraints will persist through 2028.
Samsung Electronics reported a record second-quarter operating profit on Thursday, extending a streak of strong earnings driven by surging demand for memory chips used in artificial intelligence infrastructure, while warning that supply constraints in the sector will persist well into 2028.
The South Korean technology giant posted operating profit of 89.5 trillion won for the quarter, beating LSEG SmartEstimate expectations of 88.13 trillion won. Revenue came in at 171.5 trillion won ($118.7 billion), slightly below the 172.65 trillion won analysts had forecast.
The year-on-year increase in operating profit was 1,814%, while revenue rose 130% compared with the same period a year earlier. Profit also jumped more than 56% from the prior quarter, with revenue climbing more than 28%.
Samsung credited AI server demand as the primary driver of the results, saying the performance helped it achieve all-time high sales of both DRAM and NAND memory chips — components used across smartphones, automotive systems, and server infrastructure.
The company also said it scaled up sales of its sixth-generation high-bandwidth memory product, HBM4, and shipped the industry's first HBM4E samples to major customers. HBM4 is designed to power advanced AI processors, including Nvidia's Vera Rubin Platform.
Samsung said supply constraints in the memory market are expected to tighten further in 2027, with what it described as exponential growth in AI token generation driving demand over the medium to long term.
"The AI infrastructure buildout is still paying its suppliers handsomely, and Samsung expects more to come, pointing to strong memory demand in the second half as agentic AI adds another layer of appetite for its chips," said Josh Gilbert, lead analyst for APAC at eToro.
For the second half of the year, Samsung said it anticipates robust demand for memory centered on servers, accelerating appetite for server DRAM and enterprise SSDs, and continuing AI infrastructure capital expenditure tied to the broader adoption of agentic AI.
The company added that more customers are seeking multi-year supply agreements to lock in AI infrastructure capacity, giving Samsung better visibility into future demand. It said it has finalized agreements with its top five global data center customers and is in final-stage talks with five additional major accounts.
Memory capital expenditure increased quarter over quarter as Samsung expanded investment in a new fabrication facility in Pyeongtaek and other infrastructure projects.
Not all divisions performed equally. Samsung's mobile and networks business swung to a 700 billion won loss, squeezed by the elevated component costs that are simultaneously driving the semiconductor boom. Revenue in that segment still grew year on year, supported by solid sales of the Galaxy S26 series and momentum for the Galaxy A series.
Samsung also said it recently established a robotics division under direct CEO oversight, describing robotics — alongside AI — as a key growth area, and said it is exploring collaborations with startups as well as potential mergers and acquisitions.
On the question of a U.S. stock listing, Samsung said it is "not currently reviewing an ADR issuance," though it added that from a mid- to long-term shareholder value perspective, such a listing remains "one of several possible options that could be open for consideration."
Samsung shares closed 0.72% lower on Thursday, even as the underlying results matched or exceeded expectations. Domestic rival SK Hynix reported its own record second-quarter profit on Wednesday, though it fell short of analyst estimates, reinforcing the broad — if uneven — strength across the AI memory supply chain.
Sara Montes de Oca is the Editor in Chief of TechEchelon. Previously a correspondent and producer in Washington, D.C., covering business, finance, and politics.
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