Samsung Electronics forecasts a steep rise in its third-quarter profit, driven by strong demand for AI-related chips and memory products. The company projects its operating profit will reach 12.1 trillion won, representing a 32% increase from a year earlier—its strongest quarterly showing in over three years. The upbeat outlook underscores how AI infrastructure investment is reshaping semiconductor dynamics.

Memory Business Resurgence Leads the Charge

Samsung’s results are being lifted by a robust rebound in conventional memory chip demand. Shipments and pricing for DRAM and NAND products have surged, partly due to tight supply and rising infrastructure investment in AI and cloud services. Some DRAM prices have jumped by as much as 171.8% year over year, significantly boosting revenue per unit.

While high-bandwidth memory (HBM) segments—essential for AI accelerators—have been slow to ramp for Samsung, the strength in core memory products has more than made up for the shortfall. Additionally, Samsung’s foundry business has shown signs of improvement, with better utilization rates helping to narrow losses in that unit.

Market Reaction and Competitive Landscape

Samsung’s share price has rallied sharply in 2025, buoyed by the strong AI narrative and renewed investor confidence in its memory franchise. The optimism is also supported by announcements of new supply deals with AI platforms and major cloud providers.

Competition, however, is intensifying. SK Hynix and Micron are aggressively targeting the high-end memory space, particularly in HBM, and have posted strong gains in recent quarters. Analysts warn that Samsung must deliver on next-generation memory technology and maintain supply chain resilience to fend off rivals.

Risks, Trade Policy and Geopolitical Headwinds

Despite the promising outlook, Samsung faces significant risks. U.S. export controls, particularly on advanced semiconductors, could limit the company’s ability to ship to key markets, especially China. Further, China’s tightening export restrictions on rare earths and other critical materials could raise manufacturing costs and constrain production of cutting-edge chips.

Fluctuations in global demand, inventory cycles, and cycles of oversupply remain ever-present challenges in the memory market. Samsung must carefully balance capacity expansion with discipline to avoid margin erosion in a downturn.

Looking ahead, Samsung’s full Q3 results will be released in October, offering deeper insight into segmental performance, capital expenditure plans, and margin trends. Investors will be watching for signs of sustained AI demand and whether Samsung can accelerate its HBM ramp to recapture competitive ground. The company’s ability to manage regulatory and geopolitical risks will be critical in converting this projected earnings burst into long-term sustainable growth.