Samsung posts 208% profit boost driven by AI servers demand
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The news: Shares in South Korea’s Samsung Electronics rose ahead of the company reporting a better-than-expected 208% surge in quarterly profit, driven by strong global demand for AI servers that has sharply lifted memory chip prices.
Samsung shares rose 0.71% to KRW141,100 ($145.5) as of 12:06pm AEDT.
The context: Samsung Electronics reported a preliminary operating profit jump of 208% to 20 trillion won ($20.52 billion) in the December quarter, beating analysts’ estimates of 17.8 trillion won ($18.27 billion). Revenue rose 23% to 93 trillion won ($95.44 billion).
Samsung's shares have doubled in value in 2025 driven by sustained demand for AI servers that has driven higher memory chip prices.
Bloomberg reported that memory chip makers such as Samsung have been diverting production away from everyday technology products toward higher end chips for AI companies to meet demand from large data centres. This shift has created shortages in standard memory used in laptops and servers, pushing dynamic random-access memory (DRAM) chip prices sharply higher.
What they said: "Hyperscalers and cloud providers are buying a lot of DRAM and they are willing to pay a price premium. Prices are likely to remain very strong throughout 2026 and possibly through the first half of 2027," CLSA Securities Korea head of research Sanjeev Rana said.
"Even after that, we may not see much correction because demand is just too strong and supply is tight".
The source: Bloomberg
