Samsung Electronics announced that its operating profit more than tripled to a record high in the fourth quarter and projected continued strong demand for chips, as the global race to build artificial intelligence systems drains chip supplies and drives up prices significantly.
Article contents:
- Record performance driven by AI
- Stunning financial results and record numbers
- Challenges and pressures in the mobile sector
- Strong display performance with Apple
- High Bandwidth Memory (HBM) chip race
- Conclusion
- Frequently Asked Questions
Record performance driven by AI
The results highlight the immense pricing power of the world’s largest memory chip maker, whose earnings growth is expected to accelerate this year. Samsung said in a statement: “The ongoing AI boom is expected to continue driving favorable market conditions across the industry” in the first quarter of 2026. However, it warned that soaring memory chip prices are weighing on its smartphone and display businesses.
Stunning financial results and record numbers
The South Korean company recorded 20 trillion won ($13.98 billion) in operating profit for the October-December period, in line with its estimates and up massively from 6.49 trillion won a year earlier. Revenue reached 93.8 trillion won, a 24% increase. Operating profit in the chip division, the company’s main cash cow, jumped 470% to a record 16.4 trillion won, reflecting the sheer scale of demand.
Challenges and pressures in the mobile sector
In contrast, profits in the mobile division, which faced pressure from rising chip prices, fell to 1.9 trillion won. Samsung said the mobile business is expected to face increasing cost pressures this year. TM Roh, co-CEO of Samsung, described the acute chip shortage as “unprecedented,” adding that he did not rule out raising phone prices to offset these mounting costs.
Strong display performance with Apple
Display division profits doubled to 2 trillion won thanks to robust sales of the “iPhone 17” series for its key client, Apple. However, the sector anticipates weaker smartphone demand in the current quarter as prices rise due to memory chip supply shortages, which could prompt customers to push for price cuts.
High Bandwidth Memory (HBM) chip race
Samsung said it is on track to begin shipments of its next-generation High Bandwidth Memory (HBM4) chips in the current quarter, with analysts expecting initial shipments to go to Nvidia. Samsung is trying to catch up with its domestic rival SK Hynix, the leading supplier of advanced memory chips essential for Nvidia’s AI accelerators, after experiencing supply delays that impacted its profits last year.
Conclusion
Samsung’s report proves that artificial intelligence is currently the main driver of the tech economy, devouring servers and memory chips, while traditional consumer electronics face pressures from rising component costs. The year 2026 looks extremely promising for chip giants.
Frequently Asked Questions
Question: What caused the jump in Samsung’s profits?
Answer: Massive demand for High Bandwidth Memory (HBM) chips used in artificial intelligence servers.
Question: How does this affect phone prices?
Answer: Smartphone prices may rise due to chip shortages and higher costs.
Question: When will Samsung launch HBM4 chips?
Answer: Deliveries are expected to begin in the current quarter of 2026.
