- Samsung is making surprisingly strong profits
Samsung saw significant gains in the second quarter of 2024, thanks to rising chip prices and strong demand for AI applications. The South Korean tech giant's operating profit surged to 10.44 trillion won (around 7 billion euros), a more than fifteenfold increase year-over-year. Revenue also jumped by around 23% to 74.07 trillion won (around 50 billion euros).
Samsung's results exceeded most economists' expectations. As the industry leader, the company benefited greatly from the soaring chip prices driven by the AI boom. Just a year ago, chip prices were at relatively low levels due to oversupply and sluggish demand.
Notably, Samsung's business segment for HBM (High-Bandwidth Memory) chips saw a robust increase of over 50% compared to the previous quarter. These high-performance memory chips are widely used in AI applications.
Optimistic Outlook
For the second half of the year, Samsung expects the market share of AI services to continue growing as companies increase their investments in this area. The company also anticipates sustained strong demand for HBM chips.
On Wednesday, Samsung Electronics' stock price rose by nearly 3.6%. The South Korean KOSPI index also closed with a gain of 1.19% following the positive earnings report.
Samsung leads the market in memory chips and televisions. In the first quarter, the South Koreans also reclaimed the top spot in the smartphone market from Apple, according to market researchers.
Earlier this month, South Korea's largest labor union called for an indefinite strike at Samsung, demanding fair wages. Negotiations are still ongoing.
The Quarterly figures for Samsung's second quarter of 2024 demonstrate the company's impressive growth, with an operating profit increase of over 15 times compared to the previous year. Samsung's anticipates a continued growth in the market share of AI services and strong demand for HBM chips in the second half of the year, based on these Quarterly figures.
