Remember when Samsung was struggling earlier this year? Their chip division was a mess, profits were down, and everyone wondered if they’d lost their edge to competitors like SK Hynix.
Well, forget all that. Samsung just dropped their third-quarter earnings, and the numbers are nuts.
Operating profit jumped 160% compared to last quarter. That’s not a typo. One hundred and sixty percent. They went from 4.7 trillion won in Q2 to 12.2 trillion won in Q3. In dollar terms, that’s $8.5 billion in profit for just three months.
Revenue also climbed 15% to hit 86 trillion won, which works out to about $60 billion. And their stock popped 4% when the news came out.
So what changed? How did Samsung go from struggling to crushing it in just one quarter?
The Chip Business Saved Them
Samsung makes a lot of stuff – phones, TVs, home appliances, displays. But the real story here is semiconductors.
Their chip division alone brought in 7 trillion won in operating profit. That’s $4.9 billion from one division. Compare that to the measly 400 billion won they made last quarter, and you can see why everyone’s excited.
The chip business hit record-high revenue thanks to two specific products: HBM3E memory chips and server SSDs (solid state drives). Both of these are critical for AI data centers – the massive server farms that run ChatGPT, Google’s AI tools, and everything else in the AI boom.
Basically, every tech company building AI infrastructure right now needs these chips. And Samsung finally figured out how to make them at scale and actually get them to customers.
The AI Boom Is Real (For Samsung at Least)
Look, we’ve all heard the hype about AI. But Samsung’s earnings show the AI boom isn’t just hype – companies are actually spending massive amounts of money building out infrastructure.
Data centers need memory chips. Lots of them. And not just regular memory – they need specialized high-bandwidth memory that can handle the insane data processing requirements of AI models.
Prices for these chips have gone through the roof. DRAM prices jumped 170% year-over-year according to Goldman Sachs analysts. Average selling prices for DRAM rose 7% just this quarter. For NAND flash memory, prices went up 6%.
When you’re selling more chips at higher prices, profits go up fast. That’s exactly what happened to Samsung.
Server SSD sales also exploded as cloud companies raced to expand capacity. Amazon, Google, Microsoft – they’re all building more data centers and buying more storage. Samsung’s high-density SSDs became hot sellers because they pack more storage into less physical space, which matters when you’re trying to fit thousands of servers into a building.
