Samsung Electronics reported a significant increase in operating profit, with a 10-fold rise in the last quarter compared to the same period last year. The company’s operating profit for the Jan-March quarter stood at 6.6 trillion won ($4.8 billion), driven by higher prices for memory chips and robust sales of its flagship Galaxy S24 smartphones. Revenue also saw a nearly 13% increase to 71.9 trillion won ($52 billion). The semiconductor business recorded an operating profit of 1.91 trillion won ($1.38 billion), marking its first quarterly profit since the fourth quarter of 2022.
The company attributed the strong performance to the expansion of generative AI technologies, which are driving demand for both conventional chips used in servers and advanced chips designed to process AI, including high-bandwidth memory. Samsung announced the mass production of its latest HBM chips, called 8-layer HBM3E, and plans to start producing the 12-layer version during the second quarter. The memory chip market is projected to remain strong in the coming months, with demand for AI chips expected to hold steady despite potential volatility from macroeconomic trends and geopolitical issues.
Samsung stated that in the second half of 2024, business conditions are expected to remain positive, especially with the strong demand for generative AI. The company will continue to focus on boosting sales of its flagship device, the Galaxy S24, which offers new AI-enabled features such as live translation during phone calls in multiple languages and dialects. Samsung plans to expand AI features to other mobile devices, anticipating that the technology will drive growth in the smartphone market as global consumer spending improves.
With the positive outlook for the memory chip market and the continued focus on AI technologies, Samsung aims to capitalize on these trends to enhance its position in the semiconductor and smartphone industries. The company’s successful shift towards AI-driven features in its flagship devices reflects its commitment to innovation and meeting the evolving demands of consumers. As Samsung continues to invest in cutting-edge technologies and production capabilities, it is well-positioned to maintain its strong performance and drive growth in key market segments. The company’s strategic focus on AI and memory chip technologies is expected to drive sustained growth and profitability in the coming quarters.
