Quarterly Profit Falls Amid Fierce Competition
Samsung Electronics reported a 40% decline in its chip profits quarter-over-quarter, a sharp contrast to competitors TSMC and SK Hynix, which saw earnings surge due to the AI boom. Samsung, the world’s largest memory chipmaker, smartphone, and TV producer, cautioned about limited earnings growth in the fourth quarter due to intense consumer electronics competition during the year-end peak.
AI Demand Fuels Premium Chip Focus
In its earnings statement, Samsung highlighted that while demand for memory chips in mobile and PC markets may soften, AI growth will sustain strong demand. The company plans to prioritize high-bandwidth memory (HBM) and high-density chip products, which are crucial for AI applications like those developed by Nvidia.
Third-Quarter Financial Highlights
Samsung posted an operating profit of 9.2 trillion won ($6.66 billion) for Q3, a slight improvement from 2.4 trillion won a year earlier but down from 10.4 trillion won in Q2. This result slightly exceeded the company’s preliminary estimate but fell short of market expectations. Shares of Samsung dipped 0.2% as South Korea's broader market fell by 1.3%.
Challenges in Competing with Rivals
Although Samsung’s Q3 chip earnings rose to 3.9 trillion won, they were impacted by one-time expenses and currency effects. Samsung’s slower pace in HBM commercialization compared to competitors has affected its competitiveness, as noted by Yuanta Securities analyst Baik Gil-hyun.


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