Samsung Electronics and SK Hynix are experiencing unprecedented financial success, driven by increased demand for artificial intelligence (AI) semiconductors. Samsung has become the first global tech giant to surpass 100 trillion won in quarterly operating profit, while SK Hynix is expected to announce its highest-ever results by the end of this month. Analysts predict that the semiconductor boom, fueled by rising demand for high-bandwidth memory (HBM) and general DRAM price increases, will continue at least through next year.
On October 8, Samsung Electronics reported a consolidated revenue of 195 trillion won and an operating profit of 107.4 trillion won for the third quarter, marking increases of 126.59% and 782.5%, respectively, compared to the same period last year. Compared to the previous quarter, revenue rose by 13.70% and operating profit by 20.01%.
This marks the first time a domestic company has exceeded 100 trillion won in quarterly operating profit, and it is also the first such record among global tech giants, including Apple and Nvidia. The operating profit margin reached a historic high of 55.1%, driven by improvements in the device solutions (DS) division, which oversees the semiconductor business.
The key to this performance is the rising prices of memory semiconductors. Increased investment in AI data centers has led to higher demand for HBM and server DRAM, while supply expansion has been limited, resulting in sustained price increases. Semiconductor manufacturers are prioritizing production capacity for HBM and high-value server products, exacerbating the supply shortage of general DRAM.
The expansion of HBM production is driving up the prices of general DRAM, which in turn enhances the profitability of semiconductor companies. As memory manufacturers maintain a production strategy focused on high-value products rather than increasing supply volumes, their negotiating power on prices has also strengthened.
SK Hynix, which will announce its results on October 27, is also expected to report record earnings.
According to financial information provider FnGuide, SK Hynix's consensus for third-quarter operating profit is 77.2214 trillion won, a 578.37% increase from the same period last year. Combined, the preliminary operating profit of Samsung Electronics and the market forecast for SK Hynix amounts to 184.6214 trillion won.
SK Hynix is maintaining high profitability based on its competitive supply position in the HBM market. The increase in sales of high-value products, such as server DRAM and enterprise solid-state drives (SSDs), alongside expanded HBM supply to major AI semiconductor clients, is supporting its performance improvement.
The upward trend in performance for both companies is expected to continue beyond the fourth quarter of this year and into 2027. This is due to ongoing investments in AI data centers by global tech giants, while the pace of memory semiconductor supply expansion is not keeping up with rising demand. Furthermore, the significant price increases for DRAM and NAND this year, along with potential HBM price hikes starting next year, are likely to contribute to this trend. Market research firm TrendForce predicts that the average selling price (ASP) of HBM will rise by 121% next year compared to this year.
Analysts are also raising their earnings forecasts for next year. Meritz Securities recently increased its 2027 operating profit forecast for Samsung Electronics from 562 trillion won to 632 trillion won, a 13% increase. This adjustment reflects expectations that the demand for server memory will continue to rise and that the price increases resulting from the transition to high-value products will persist into next year.
Expectations for SK Hynix's performance next year are also high. Eugene Investment & Securities forecasts that SK Hynix's annual operating profit will reach 263.4 trillion won this year and 454.1 trillion won next year. Even if the rate of memory price increases slows, the company is expected to improve its operating profit margin from 76% this year to 80% next year by increasing the proportion of high-value products.
The expansion of next-generation HBM, known as HBM4, will also be a key factor in determining next year's performance. Samsung is strengthening its competitive position in AI memory supply centered around HBM4, while SK Hynix is focusing on producing next-generation products and expanding supply to clients. The performance gap between the two companies may vary depending on their supply volumes and client acquisition in the HBM market.
However, it remains uncertain whether the unprecedented semiconductor boom driven by rising memory prices will be sustained over the long term. The supply and demand situation may change depending on the production capacity expansion of semiconductor companies and the pace of AI investments by big tech firms. Additionally, the impact of the strong won on exchange rates and fluctuations in memory price increases are also factors to consider.
* This article has been translated by AI.
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