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Samsung logs best-ever profit on AI chip demand
South Korean tech giant Samsung Electronics posted record quarterly profits Thursday, riding massive market demand for the memory chips that power artificial intelligence.
A global frenzy to build AI data centres and develop the fast-evolving technology has sent orders for advanced high‑bandwidth memory microchips soaring.
That is also pushing up prices for less flashy chips used in consumer electronics -- threatening higher prices for phones, laptops and other devices worldwide.
In the quarter to December 2025, Samsung said it saw "its highest-ever quarterly consolidated revenue at KRW 93.8 trillion (US$65.5 billion)", a quarter-on-quarter increase of nine percent.
"Operating profit was also an all-time high, at KRW 20.1 trillion," the company said.
The dazzling earnings came a day after a key competitor, South Korean chip giant SK hynix, said operating profit had doubled last year to a record high, also buoyed by the AI boom.
The South Korean government has pledged to become one of the top three AI powers, behind the United States and China, with Samsung and SK hynix among the leading producers of high-performance memory.
Samsung said Thursday it expects "AI and server demand to continue increasing, leading to more opportunities for structural growth".
Annual revenue stood at 333.6 trillion won, while operating profit came in at 43.6 trillion won. Sales for the division that oversees its semiconductor business rose 33 percent quarter-on-quarter.
The company pointed to a $33.2 billion investment in chip production facilities -- pledging to continue spending in "transitioning to advanced manufacturing processes and upgrading existing production lines to meet rising demand".
- 'Clearly back' -
Major electronics manufacturers and industry analysts have warned that chipmakers focusing on AI sales will cause higher retail prices for consumer products across the board.
This week US chip firm Micron said it was building a $24 billion plant in Singapore in response to AI-driven demand that has caused a global shortage of memory components.
SK hynix announced Wednesday that its operating profit had doubled last year to a record 47.2 trillion won.
The company's shares have surged some 220 percent over the past six months, while Samsung Electronics has risen about 130 percent, part of a huge global tech rally fuelled by optimism over AI.
Both companies are on the cusp of producing next-generation high-bandwidth "HBM4" chips for AI data centres, with Samsung reportedly due to start making them in February.
American chip giant Nvidia -- now the world's most valuable company -- is expected to be one of Samsung's customers for HBM4 chips.
But Nvidia has reportedly allocated around 70 percent of its HBM4 demand to SK hynix for 2026, up from the market's previous estimate of 50 percent.
"Samsung is clearly back and we are expecting them to show a significant turnaround with HBM4 for Nvidia's new products -- helping them move past last year's quality issues," Hwang Min-seong, research director at market analysis firm Counterpoint, told AFP.
But SK still "maintains a market lead in both quality and supply" of a number of key components, including Dynamic Random Access Memory chips used in AI servers, he said.
SK also this week said it will set up an "AI solutions firm" in the United States, committing $10 billion and weighing investments in US companies.
M.Ouellet--BTB