Samsung’s stock rises on explosive operating profit growth
Samsung Electronics Co. Ltd. today confirmed its earlier expectation that runaway memory chip prices will drive a massive 19-fold jump in operating profit, as robust artificial intelligence demand continues to accelerate momentum in its semiconductor business.
The company just announced its full first-quarter results, saying it delivered total revenue of 171.5 trillion won (around $118.56 billion), up 130% but trailing the analyst consensus estimate of 172.65 trillion. However, the slight shortfall in sales was made up for by Samsung’s profitability, which exceeded expectations. The company reported an operating profit of 89.5 trillion won during the quarter, up a staggering 1,814% from the same period one year earlier and ahead of the 88.13 trillion won forecast.
Samsung’s stock was up more than 5% during the early trading session in South Korea Thursday morning.
Samsung said its chipmaking business was the key growth driver during the quarter, recording a record operating profit of 89.2 trillion won, meaning it accounted for virtually all of its profit. Runaway AI server demand was the main reason for those record-breaking numbers, helping Samsung to register all-time high sales of both dynamic random-access memory and NAND flash chips, which are both key components in those products.
