Samsung Q3 profit surges to record high, but misses lofty expectations

Samsung Electronics Co Ltd reported a record-setting third-quarter profit of approximately 107.40 trillion won ($80.1 billion) for the period ending September 30, marking a nearly tenfold increase from the 12.2 trillion won profit recorded a year prior. The robust performance, fueled by strong artificial intelligence (AI) demand for memory chips, surpassed Bloomberg's forecasts of 108.67 trillion won.

Operating profit was slightly above LSEG's estimates of 106.1 trillion won. Samsung's sales more than doubled to 195 trillion won from 86.06 trillion won a year earlier, with this marked fourth consecutive quarter of record profits. The surge was attributed to the heightened demand for advanced memory chips, driven by AI advancements, which fueled the need for computational power and consequently, tightened supplies and increased prices.

Samsung, along with SK Hynix Inc and Micron, is a key supplier of high-bandwidth memory to AI chipmaker NVIDIA Corporation. While the strong earnings benefited Samsung and its peers, the company anticipates challenges from its smartphone and consumer electronics divisions, which may face mounting pressure due to rising component costs.

Additionally, a stronger South Korean won could have negatively impacted Samsung's earnings by reducing the value of overseas sales. Detailed results are expected to be released on October 29.