Samsung Electronics' first quarter operating profit surged 755% to KRW 57.2 trillion, setting a new historical high for Korean companies

On April 7th, Samsung Electronics released its preliminary performance report for the first quarter of 2026, achieving consolidated sales of KRW 133 trillion (approximately 89.2 billion US dollars), a year-on-year increase of 68.1%; The consolidated operating profit reached 57.2 trillion Korean won (approximately 3.84 billion US dollars), a year-on-year surge of 755%, setting a record for the highest quarterly profit in a single quarter and also the highest quarterly profit in the history of Korean companies.

The performance far exceeded expectations, and the quarterly profit exceeded last year's total

The performance announced this time significantly exceeded market expectations. Previously, analysts had expected Samsung Electronics' first quarter operating profit to be 

approximately 39.3 trillion Korean won, but the actual data was about 45% higher than expected.

Compared with the fourth quarter of 2025, revenue increased by 41.7% month on month (93.84 trillion Korean won in the previous quarter), and operating profit increased by

185% month on month (20.1 trillion Korean won in the previous quarter), achieving two consecutive quarters of rapid growth.

AI demand-driven: Memory chips contribute nearly 90% of profits

The main driving force behind the explosive performance comes from the Semiconductor (DS) department. Sangif Rana, head of research at Lyon Securities Korea, said, "The performance 

growth is entirely driven by storage chips and far exceeds market expectations." He estimated that the storage chip business may contribute nearly 90% to the total operating profit.

Specific driving factors include:

First, there has been a surge in investment in AI data centers. Customers led by cloud service providers have significantly increased orders for high-bandwidth memory (HBM) and other chips in data centers to meet the demands of AI services. With global tech giants continuously expanding their AI infrastructure investments, the demand for server DRAM and HBM has shown structural growth.

The second factor is the significant price surge in memory chips. A Citigroup report indicates that global DRAM average selling prices skyrocketed by 64% quarter-on-quarter in Q1. As major manufacturers including Samsung, SK Hynix, and Micron shifted production capacity to high-margin HBM products, traditional DRAM supply tightened, driving a broad-based price increase.

Third, HBM competitiveness has been restored. Samsung Electronics enhanced its responsiveness in the AI memory market by expanding HBM supply to key clients such as NVIDIA and AMD. The company was the first to achieve commercial shipments of the next-generation HBM4 chips and introduced its cutting-edge HBM4E chips at NVIDIAs GTC conference.

Industry Prosperity Verification: South Koreas Semiconductor Exports Surge

Samsung Electronics outstanding performance has validated the super cycle in the global semiconductor industry. According to South Korean government data, South Koreas semiconductor exports—a barometer of global technology demand—soared by 151.4% in March, reaching a historic peak of $32.8 billion.

Market analysts are optimistic about the annual performance. Citigroup predicts that strong demand for AI inference will sustain high chip prices, with Samsungs full-year operating profit expected to reach 310 trillion won (approximately 207.0 billion US dollars) in 2026.

Stock Price and Market Reaction

Following the earnings release, Samsung Electronics stock price surged 5% in Seoul pre-market trading, reversing its decline from Februarys peak and easing market concerns that geopolitical conflicts might undermine the sustainability of AI hardware investments.

Despite its record-breaking performance, Samsung Electronics stock price surged over 120% last year, still lagging behind rival SK Hynixs 270% gain. This indicates the market continues to adjust for its earlier pricing missteps in the HBM sector.

Samsung Electronics will release detailed financial results and business outlooks for its key divisions (semiconductors, smartphones, home appliances, etc.) at the end of this month through earnings conferences and teleconferences.