Samsung Electronics second-quarter operating profit beats estimates on soaring AI chip demand

Samsung Electronics reported second-quarter operating profit that exceeded analyst estimates, driven by surging demand for AI memory chips. The South Korean chipmaker extended its recovery streak as artificial intelligence applications continue to fuel growth in its memory semiconductor business.

The beat comes as hyperscalers and AI infrastructure providers ramp up orders for high-bandwidth memory (HBM) and other advanced chip solutions needed for training and deploying large language models. Samsung competes directly with SK Hynix and Micron Technology (MU) in the AI memory space, where pricing power has returned after a prolonged downturn through 2023.

Samsung trades OTC in the U.S. under ticker SSNLF. The stock has rallied alongside the broader AI chip complex in 2024, though it has lagged SK Hynix's gains as investors debate Samsung's HBM market share trajectory.

The earnings surprise reinforces the sector-wide tailwind from generative AI infrastructure spending, which has lifted margins and utilization rates across memory manufacturers. Samsung's chip division had posted losses during the inventory correction but returned to profitability as AI demand accelerated.