Key Highlights
- First-quarter operating profit jumped 750%+ compared to last year, reaching 57.2 trillion won
- Semiconductor segment generated 53.7 trillion won — representing over 90% of company-wide earnings
- Mass production of HBM4 memory initiated for Nvidia’s upcoming Vera Rubin AI infrastructure
- Memory chip supply constraints projected to intensify through 2027 amid surging AI requirements
- Smartphone and screen businesses faced margin pressure from elevated component pricing
Samsung Electronics delivered blockbuster first-quarter results on Thursday, reporting operating profit that skyrocketed more than 750% versus the prior-year period to reach 57.2 trillion Korean won (approximately $38.5 billion). The company generated revenue of 133.9 trillion won, marking a 69% year-over-year increase that exceeded Wall Street expectations across the board.
The extraordinary performance was powered by a single dominant force: semiconductor sales.
The tech giant’s Device Solutions arm — encompassing memory chips and semiconductor operations — delivered 53.7 trillion won in operating income, compared to a mere 1.1 trillion won during the equivalent quarter twelve months ago. This represents a staggering 49-times multiplication in annual terms and comprised 94% of Samsung’s consolidated quarterly profit.
A worldwide scarcity of memory components, propelled by unprecedented AI data center construction, has driven chip prices dramatically higher. Samsung has emerged as one of the primary winners from this trend. The corporation’s operating margin in its semiconductor business topped 70% during the first quarter, outpacing both Nvidia and TSMC during the same timeframe, per data from Counterpoint Research.
The company additionally disclosed that it has secured multi-year binding supply agreements with buyers seeking guaranteed allocations — an indicator of the severe market tightness currently prevailing.
HBM4 Launch and Competition With SK Hynix
Samsung announced it launched commercial sales of mass-produced HBM4 memory in February, marking the industry’s first commercial deployment of the sixth-generation high-bandwidth memory technology. These advanced chips are designated for integration into Nvidia’s forthcoming Vera Rubin artificial intelligence platform.
SK Hynix has maintained dominance in the HBM market, capturing 57% of revenue market share during Q4 2025 based on Counterpoint Research figures. The rival chipmaker distributed HBM4 engineering samples to clients in March 2024 and established mass production readiness by September, though commercial volume shipments have not been publicly confirmed.
Industry observers suggest the competitive distance is shrinking. “Samsung has achieved notable progress with HBM4 technology and the performance differential versus SK Hynix is reduced compared to earlier generations,” noted Ray Wang from SemiAnalysis, while acknowledging SK Hynix maintains an overall leadership position.
Samsung projected it will expand HBM revenue by more than three times in the current year relative to 2026 levels.
Memory Shortage Intensifying
Samsung’s memory business head Kim Jaejune informed analysts Thursday that current demand fulfillment rates have dropped to unprecedented lows. Corporate customers anxious about future allocation constraints are already advancing their 2027 purchase orders.
“Considering only the confirmed demand we’ve received for 2027, the mismatch between available supply and customer requirements for 2027 will expand even more significantly than what we experienced in 2026,” Kim explained.
The conglomerate intends to substantially boost capital investment this year in an effort to close the gap.
Samsung is additionally monitoring potential workforce disruptions. Labor unions representing the majority of employees in its semiconductor operations are evaluating strike action over compensation issues. Management stated it has established a specialized response task force to avert any production interruptions.
Regarding cost dynamics, the elevated chip pricing benefiting the memory segment is creating headwinds elsewhere in Samsung’s portfolio. The mobile handset division experienced a 35% profit decline in Q1 to 2.8 trillion won, pressured by inflated component expenses. The display panel unit similarly posted a 20% profit reduction to 400 billion won.
Samsung’s shares climbed as much as 1.8% immediately after the earnings announcement before reversing course to finish 2.4% lower, with market observers attributing the decline to profit-taking following the stock’s remarkable 88% advance year-to-date.
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