Samsung Electronics has presented a strong forecast for second-quarter operating profit — 89.4 trillion won ($58.4 billion). This is 19 times higher than a year earlier and marks the third consecutive record quarter for the tech giant. However, the market reacted unexpectedly: the company's shares fell more than 6% at the start of trading, continuing a correction after a fivefold increase over the past year.
Samsung's forecast surpassed consensus estimates from LSEG analysts (87.3 trillion won) and FnGuide (84.4 trillion won). Revenue, according to the company's expectations, will grow 129% year-on-year to 171 trillion won. However, this figure came in slightly below market forecasts of 173.3 trillion won.
AI Fuels Demand for Memory Chips
The main growth driver is the artificial intelligence boom. Demand for high-performance HBM chips and server solutions has spilled over into standard memory modules for smartphones, PCs, and servers. According to analysts, DRAM prices rose 44% quarter-on-quarter, while NAND flash prices increased 53%. Active HBM production limits supply in the conventional chip market, creating a shortage and supporting high selling prices. Major clients are increasingly signing long-term supply contracts, reinforcing confidence in maintaining high chip prices next year.
Additionally, in May, Samsung reached an agreement with employees of its semiconductor division to link bonuses to operating profit. The company has already set aside funds for these payments in the current quarter. Analysts calculated that without these bonus allocations, Samsung's operating profit could have exceeded 100 trillion won.
Why Are Shares Falling on Record Profit?
The apparent paradox is explained by simple profit-taking. Over the past 12 months, Samsung's market capitalization has surged fivefold, and many investors decided to lock in gains immediately after the strong report, without waiting for further price increases.
Concerns about potential memory oversupply in certain market segments also played a role. While Micron shares were supported by interest in AI, fears of an "AI bubble" and a slowdown in data center investments hit some chip suppliers. The divergence in sentiment across the semiconductor market has become noticeable.
Samsung also announced plans to invest 2,100 trillion won in the country's economy by 2040, but the timeline for these investments will be adjusted based on market conditions.
My professional opinion: The decline in Samsung shares amid record profit is a classic "buy the rumor, sell the news" pattern. However, the fundamental growth drivers remain strong. Limited chip supply, long-term contracts, and the ongoing AI boom create a solid foundation for further growth. The current correction is not a trend reversal but an entry opportunity for long-term investors who believe in structural demand for semiconductors in the era of artificial intelligence.