Samsung Electronics achieves 13-fold profit surge in Q2

Samsung Electronics is set to achieve a remarkable 13-fold increase in second-quarter profit compared to the previous year. This surge is driven by the growing demand for artificial intelligence technology, leading to a resurgence in memory chip prices. The company's operating profit is expected to reach 8.8 trillion won ($6.34 billion) for the quarter ending June 30, marking its highest profit since the third quarter of 2022.

The significant rise in profit is primarily attributed to the strong performance of Samsung's semiconductor division, which has experienced two consecutive quarters of profit growth. This growth is fueled by the increasing prices of memory chips, particularly high-end DRAM chips like high bandwidth memory (HBM) chips used in AI chipsets, as well as chips for data center servers and AI-enabled devices.

In the second quarter, there was a notable increase in memory chip prices, with DRAM chips for tech devices rising by 13% to 18% and NAND Flash chips for data storage increasing by 15% to 20% compared to the previous quarter. The estimated operating profit for Samsung's chip division in Q2 stood at 4.6 trillion won, a significant improvement from the 4.36 trillion won loss in the same period last year.

Despite shipping a similar number of smartphones, Samsung's mobile business experienced a decline in operating profit in Q2 compared to the previous year. This decline is attributed to higher costs of parts, increased expenses for marketing, and development of AI services. The mobile business is estimated to have reported an operating profit of around 2.2 trillion won, down from 3.04 trillion won in the previous year.

Looking ahead, Samsung is preparing to launch its latest flagship foldable phones and mobile accessories, including a new health monitoring ring, in Paris on July 10. The company is expected to face tough competition from rival Apple in the high-end market segment.

Samsung Electronics' impressive performance in the second quarter, driven by the success of its semiconductor division amidst rising memory chip prices, showcases the company's resilience and innovation in the tech industry. As Samsung continues to innovate and introduce new products, the competition with Apple and other tech giants will likely intensify, leading to further advancements in technology for consumers worldwide.