The profitability is staggering. SK hynix delivered an operating margin of 79.7 percent in the July–September quarter, while Micron achieved 80.7 percent in its fiscal fourth quarter ended Sept. 3. Samsung's semiconductor division posted a margin of 72.4 percent, despite including its less profitable foundry and logic chip businesses.
Samsung's finalized results on Thursday marked a turning point in its comeback in high-bandwidth memory (HBM), the advanced chips essential to powering AI accelerators and data centers.
The South Korean electronics giant reported quarterly revenue of 195.3 trillion won and operating profit of 107.4 trillion won. Its Device Solutions (DS) division accounted for nearly all of the profit, generating 106.5 trillion won on revenue of 147.1 trillion won.
The comparison is not entirely like-for-like. Samsung's semiconductor division includes memory, foundry and logic chip operations, while SK hynix and Micron are predominantly memory producers. Micron also reports on a different fiscal calendar. Samsung does not separately disclose the operating margin of its memory business.
Even so, the results show how the AI boom has transformed the economics of memory manufacturing and raised the stakes in the contest for technological leadership.
The latest battleground is HBM4, the newest commercial generation of stacked memory chips designed for increasingly powerful AI processors.
Samsung said its HBM4 revenue more than tripled from the previous quarter, with the product accounting for approximately 60 percent of total HBM revenue. It also indicated that it had already achieved its goal of bringing its HBM market share in line with its broader DRAM market share, ahead of its original timetable.
The achievement represents a significant reversal for Samsung, which was slow to capitalize on the initial HBM boom while SK hynix established a commanding lead as a major supplier to Nvidia's AI accelerators.
According to Counterpoint Research, SK hynix controlled 50 percent of global HBM revenue in the second quarter of 2026, down from 64 percent a year earlier. Samsung doubled its share to 33 percent from 15 percent, while Micron held approximately 18 percent.
The shift shows that Samsung had been closing the gap even before its latest HBM4 sales acceleration.
Independent third-quarter market share figures have yet to establish whether Samsung has reached its claimed target.
Lee Jong-hwan, a professor at Sangmyung University, said Samsung's results indicate that it is catching up with SK hynix, but cautioned against attributing the extraordinary earnings entirely to HBM.
"Conventional memory prices have risen substantially, and Samsung may have a larger share of that business," Lee told AJP.
The distinction matters because HBM, despite commanding premium prices, represents only part of the wider DRAM business. Samsung has not disclosed the precise contribution of HBM and conventional memory to its semiconductor profits.
But Samsung is increasingly confident that it can challenge SK hynix in the premium segment.
"Negotiations for our 2027 HBM supply volumes have been completed at our target price levels, and the volumes are already sold out," Kim Jae-jun, vice president of memory business strategy and marketing, said during Thursday's earnings conference call. Kim added that major customers continued to request additional supply.
Samsung has already shipped samples of HBM4E, the next iteration of the technology, and is preparing to expand production in 2027. The company is also seeking to exploit its ability to manufacture both memory chips and advanced logic chips, including the base dies that control HBM stacks, as the technology becomes more complex.
SK hynix has no intention of surrendering its lead. The company reported record third-quarter revenue of 104.62 trillion won and operating profit of 83.33 trillion won on Wednesday, extending its record-breaking earnings streak to six consecutive quarters.
It expects HBM4 to overtake the previous-generation HBM3E in both shipment volume and revenue during the fourth quarter as production expands at its M15X facility.
SK hynix has also signed long-term supply agreements with 14 major customers, including major cloud service providers, covering volumes equivalent to more than half its planned production capacity for 2027 and 2028.
The contracts give SK hynix greater visibility into future demand as competitors seek to secure the same customers and production commitments.
Micron is making its own push into the next generation. The U.S. chipmaker reported revenue of $54.23 billion and GAAP operating income of $43.75 billion in its fiscal fourth quarter. It has begun high-volume shipments of HBM4 for a leading customer platform and is developing HBM4E for production in 2027.
The three-way competition is increasingly about more than market share. Each company must decide how much scarce manufacturing capacity to commit to HBM, how aggressively to invest in new facilities and how much production to reserve for conventional DRAM customers.
The competition is unfolding against a supply shortage that is itself helping to sustain extraordinary profit margins.
HBM requires multiple DRAM dies to be stacked vertically and consumes advanced manufacturing capacity that could otherwise produce conventional memory. As manufacturers devote more resources to premium HBM, supplies of standard DRAM tighten, pushing up prices across the market.
That relationship has turned the HBM boom into a broader windfall for memory manufacturers.
TrendForce expects average HBM selling prices to rise 121 percent in 2027 as demand continues to exceed supply and manufacturers shift toward higher-priced HBM4 and HBM4E products.
The leading chipmakers also see little immediate relief in supply constraints.
Samsung expects tight memory conditions to extend through 2028, while SK hynix projects shortages through 2030. Both point to the increasing complexity of advanced manufacturing and the long time required to build and equip new semiconductor facilities.
Lee said the shift toward HBM production was creating a powerful incentive for manufacturers to maintain supply discipline. "When more capacity is allocated to HBM, conventional DRAM supply inevitably decreases," he said.
With prices already elevated, Samsung and SK hynix have little immediate incentive to rush into expanding output beyond what demand can absorb, he explained.
But the industry cannot assume that today's exceptionally favorable conditions will persist indefinitely.
Lee pointed to the rapid expansion of Chinese memory manufacturers as a major uncertainty. Although Chinese competitors are unlikely to close the technological gap in HBM within a year, their growing production capabilities could eventually pressure conventional memory prices and complicate the supply strategies of established producers.
He expects favorable market conditions to continue through 2027, provided investment in AI infrastructure remains strong.
The extraordinary memory profitability is already creating winners and losers within Samsung itself.
While its semiconductor division generated 106.5 trillion won in operating profit, its Device eXperience division, which makes smartphones, televisions and home appliances, recorded an operating loss of 800 billion won as rising memory costs squeezed margins.
Lee described the widening imbalance as a growing concern, noting that Samsung's success in semiconductors was coming alongside deteriorating economics for its finished-product businesses.
The contrast exposes a fundamental tension in the AI memory boom. The same price increases delivering unprecedented returns for chipmakers are raising costs for their customers, from consumer electronics manufacturers to AI infrastructure operators.
The latest results have strengthened the case for a prolonged memory upcycle, but operating margins near 80 percent remain an extraordinary benchmark rather than an assured new normal.
The next test will be whether the three memory giants can preserve their pricing power and exceptional profitability as they race to expand capacity and compete for the same AI customers.
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