Samsung Electronics projected a three-fold jump in fourth-quarter operating profit to a record high, driven by tight supply and AI-driven demand for memory chips. Chip prices have surged, with an estimated operating profit of 20 trillion won. The global DRAM market is expected to double by 2026.

Demand for conventional chips is surging, leading to a need for more fabrication plants. Nvidia CEO Jensen Huang stated the demand for semiconductors is “terrific”, especially with AI factories. Contract prices for DRAM chips have risen significantly, with further increases expected in the current quarter.

Samsung expects revenue to rise 23% to a record 93 trillion won, with its semiconductor business generating the lion’s share of the profit. Analysts remain optimistic about Samsung’s earnings outlook, although rising memory component prices could impact margins. Samsung plans to release detailed results on January 29.

Rising memory costs could dampen demand and decrease margins for data centers, PCs, and smartphones. Analysts project a decline in Samsung’s mobile business profit due to higher component costs. Samsung’s co-CEO does not rule out raising product prices to offset memory price increases.

Samsung’s advanced memory chips business is expected to grow significantly in 2026, supported by stronger demand for custom chips like tensor processing units. The company’s next-generation HBM4 chips have been praised by customers, positioning Samsung for increased market share. Detailed earnings breakdown will be released on January 29.

Read more at Yahoo Finance: Samsung forecasts profit to triple to record high as it rides AI boom