Financial Associated Press, April 30 (editor Huang Junzhi), it is reportedRandomwheelrouletteSamsung Electronics' semiconductor business returned to profit for the first time since 2022 and surged in the first quarter, thanks to widespread investment from the artificial intelligence (AI) boom.
The world's largest memory chip maker reported that Q1 made a net profit of 6%.Randomwheelroulette.62 trillion won ($4.8 billion). This is higher than the average analyst forecast of 5.63 trillion won, more than four times that of the same period last year. Total sales in the quarter were 71.92 trillion won, of which chip sales were 23.14 trillion won, with an estimated 22.52 trillion won.
The results highlight the rebound in demand for memory chips that power modern electronics and artificial intelligence after a severe downturn. Samsung Electronics shares rose more than 2% at one point in morning trading in Seoul on Tuesday.
Samsung is trying to reverse a year-long decline triggered by global economic uncertainty. Samsung Electronics' semiconductor division lost 14.9 trillion won in 2023, and overall operating profit fell to its lowest level in 15 years.
There are signs that the market is gradually rebounding, in part because of a surge in demand for chips used to develop artificial intelligence following the launch of OpenAI's ChatGPT, which has led to a surge in demand for high-end memory chips. As a result, Samsung's chip division (DS) made a better-than-expected operating profit of 1.91 trillion won in the first quarter and returned to profit for the first time after four consecutive quarters of losses.
South Korean trade data released this month showed that semiconductor shipments were leading the growth of the country's exports in the first 20 days of April, up 43 per cent from a year earlier.
Samsung Electronics said in its earnings report that chip demand is expected to remain strong this quarter and the second half of this year, in large part because of demand for generative artificial intelligence in various industries.
In the medium to long term, Samsung is trying to catch up with its smaller rival SK Hynix in the rapidly expanding high-bandwidth memory (HBM) market. The latter last week reported the fastest revenue growth since 2010 and said overall memory demand was growing steadily because of double-digit price increases in the DRAM and NAND markets.
HBM is a new type of CPU/GPU memory chip. In short, many DDR chips are stacked together and encapsulated with GPU to achieve a high-capacity, high-bit-width DDR array. HBM can realize the realistic demand of high computing power and large storage in the era of large model. As a result, HBM is gradually becoming the key force for the storage giant to reverse its performance.
Samsung Electronics said it has begun mass production of its latest HBM product, the HBM3E 8H (eight-tier stack), and plans to mass-produce the next generation HBM chip, the HBM3E 12H (12-tier stack), in the second quarter. In addition, as the company focuses on HBM production, it is expected that the supply of advanced DRAM products will be subject to additional restrictions in the second half of the year.