Samsung Electronics Pledges Up to 110 Trillion Won in Record Shareholder Returns

Samsung Electronics has announced an unprecedented shareholder return plan, estimated at 90 trillion won to 110 trillion won, the largest in South Korean corporate history. The plan, approved by the company's board of directors on August 21, is expected to include a mix of cash dividends and share buybacks. The surge in profits from the AI-driven semiconductor supercycle has fueled this unprecedented move, with analysts forecasting the company's full-year operating profit to hit 380 trillion won.

Samsung plans to pay about 30 trillion won in cash dividends in the third quarter, with the remaining returns to be determined at a board meeting in January. The move aims to normalize the company's valuation, currently at around four times earnings, and provide a near-term catalyst for Samsung shares. Some analysts anticipate a greater proportion of cash dividends, which could improve the stock's yield and push the price towards the 300,000-won range.

Despite the size of the plan, the market's response has been mixed, with Samsung shares initially rising but then falling in after-hours trading due to the range being below expectations. Nonetheless, analysts remain optimistic, projecting that Samsung will enter a more substantial shareholder return cycle in the coming year.