Samsung Electronics has revealed that its quarterly profits for the period July to September 2026 will increase more than nine-fold when compared to its earnings for the same period last year. The firm expects its profits to reach $80 billion for the just-ended quarter.
The South Korean company will publish its detailed earnings reports for Q3 2026 at the end of this month. In the country, it is normal for large companies to provide their own earnings projections ahead of the publication of the earnings reports. These briefs often carry more weight in the eyes of investors when compared to forecasts published by external analysts because the companies rely on their own actual data to release these figures.
Samsung says its profits have surged amid the skyrocketing demand for the memory chips needed in the construction of AI data centers. The firm is one of the largest producers of memory chips in the world.
It is also benefiting from strong sales of its recently released Galaxy Fold and other latest edition smartphones.
Global demand for AI chips, including memory chips, has exploded in recent years. This surge has enabled manufacturers like Samsung to rake in huge revenues. Consequently, their market valuations have climbed steeply, with Samsung’s market cap hitting a trillion dollars earlier in 2026.
The scale of the demand for these chips can be seen from the estimated $650 billion that AI hyperscalers like Amazon, Meta and Google have projected as their expected capex on AI projects in 2026.
Because of the chip shortage amid surging AI demand, manufacturers like Samsung and SK Hynix have raised product prices and increased their margins on each item they sell. Competition for these chips has also triggered a rise in the prices of consumer electronics like computers and smartphones as chip makers allocate more manufacturing capacity to high-margin products at the expense of lower-end chips.
That reallocation of manufacturing capacity has caused a shortage of the chips needed to manufacture consumer electronics. It isn’t therefore surprising that Samsung is reporting record profits on the back of selling AI memory chips, high-end smartphones and other electronics.
As has been the case, every boom lifts a cross-section of players in that specific segment. It isn’t therefore surprising that other manufacturers of AI memory chips, such as Micron Technology Inc. (NASDAQ: MU), are also enjoying strong revenue growth as they produce the chips that major AI businesses like Nvidia require for their stack of products, and many of these companies have surpassed the trillion-dollar valuation by market cap.
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