Samsung Forecasts a 19-Fold Profit Surge as AI Chip Demand Powers Growth
Samsung Electronics released preliminary guidance this week, projecting its second-quarter 2026 operating profit to be approximately 89.4 trillion won ($58.4 billion). This represents an increase of roughly 1,810% (nearly 19 times) over the same quarter last year. Consolidated revenue is expected to reach 171 trillion won, up 129% year over year.
If these final numbers hold, it would mark Samsung's third consecutive record-breaking quarter. Notably, this quarterly operating profit would also surpass the highest quarter Nvidia has ever reported.
The Numbers Behind the Headline
Samsung's Q1 2026 results had already set the stage:
- Revenue: 133.9 trillion won
- Operating Profit: 57.2 trillion won
Both were records at the time, with the Memory division alone posting an 86% quarter-on-quarter jump in sales. According to internal figures reported by Samsung, AI memory accounted for approximately 94% of the company's total profit in that quarter. Q2's guidance significantly extends this trajectory, indicating sustained growth rather than a one-off spike.
What's driving this isn't confined to just premium AI chips. Analysts describe a shortage spanning the entire memory market, including:
- DRAM
- NAND flash
- High-bandwidth memory (HBM)
Citi Research found that average DRAM selling prices rose 44% quarter over quarter in Q2, with NAND prices up 53% over the same period. Nomura is projecting further increases of 24% for DRAM and 25% for NAND in Q3, suggesting the price cycle is far from over.
Why AI Is the Real Driver
Samsung began mass production of HBM4, its sixth-generation high-bandwidth memory, in February 2026, describing it as an industry first. This advanced chip delivers:
- 2.7 times the memory bandwidth per stack compared to the previous generation
- Reaches up to 3.3 terabytes per second
- Achieves roughly 40% better power efficiency
Samsung is already supplying HBM4 to Nvidia and is reportedly in discussions to extend collaborations to AMD and Google. The company anticipates its HBM sales to more than triple in 2026 compared to 2025.
Analysts increasingly attribute the surge in demand not just to specialized AI accelerator chips but also to the broader expansion of agentic AI applications. These applications require large pools of conventional memory alongside fast inference hardware. This explains why the current upswing is impacting DRAM and NAND prices as well, and not just the premium HBM segment.
Beyond Memory: A Foundry Turnaround and New Contracts
Samsung's chip manufacturing (foundry) business, which had reported losses for years, reportedly returned to monthly profitability in June 2026 for the first time since 2023.
The company has also secured a $16.5 billion chip manufacturing contract with Tesla for its AI6 chip. Furthermore, Samsung is producing Groq-powered AI processors, with reports suggesting that Meta and Anthropic are also evaluating Samsung as a manufacturing partner.
Kim Yong-kwan, president of Samsung's Device Solutions division, has stated that the company's semiconductor unit is on pace to generate more operating profit in 2026 alone than Samsung has earned cumulatively across four decades in the chip business. Some analyst estimates place the full-year 2026 operating profit as high as 300 trillion won, which is roughly $217 billion.
The Risk Analysts Are Watching
Not everyone views this as a guaranteed multi-year run. JPMorgan has noted that AI memory's share of cloud providers' capital spending has risen to an estimated 52% in 2026 and is projected to exceed 70% in 2027. This concentration raises an obvious question:
What happens if that spending slows?
Microsoft has guided full-year 2026 capital spending to around $190 billion, and Meta raised its own 2026 range to $125 to $145 billion. Any pullback from hyperscalers would directly impact memory demand.
This anxiety isn't hypothetical. Korean memory stocks sold off sharply in the past week, with Samsung falling as much as 9% intraday and SK Hynix dropping nearly 15%. Both recovered within hours, serving as a reminder of how sensitive investor sentiment remains to any sign that the AI infrastructure buildout could slow.
What This Means for the Broader Tech Industry
For any company building or buying AI infrastructure, Samsung's numbers vividly illustrate where a large share of AI investment dollars are actually going: not just into GPUs, but also into the memory that feeds them.
Elevated DRAM and NAND pricing is also expected to keep consumer electronics prices higher over the next six to twelve months. The same memory chips used in AI servers are also essential components in phones, laptops, and other consumer devices, all competing for constrained supply.
Samsung is scheduled to release detailed, division-by-division final results on July 30. These results will provide a more precise breakdown of how much of this record quarter originated from memory versus its other businesses, including its recovering foundry unit.
Conclusion
Samsung's forecast is less about one company's earnings and more a data point in a much larger pattern: AI infrastructure spending is reshaping which parts of the tech supply chain capture the most value. Currently, memory chips sit near the top of that list. Whether this trend continues depends less on Samsung's own execution and more on whether hyperscalers maintain their current pace of AI infrastructure spending—the single variable analysts continue to flag as the real risk to this entire cycle.
