Samsung Electronics anticipates a remarkable 15-fold increase in profits for the second quarter of 2024 compared to last year, driven by soaring demand for artificial intelligence (AI) chips.
As the world’s leading producer of memory chips, smartphones, and televisions, Samsung’s profits are projected to reach a staggering 10.4 trillion won ($7.54 billion), up from 670 billion won in the previous year. This forecast, which surpasses analysts’ expectations, underscores Samsung’s pivotal role in the robust AI chip market, fueled by increased demand from data centres and smartphone manufacturers.
The announcement of Samsung’s profit surge due to AI chip demand sparked a more than 2% increase in the company’s shares during early trading hours in Seoul. This significant rise underscores the strong investor confidence in Samsung’s financial outlook and its ability to capitalize on the growing AI chip market.
Marc Einstein, chief analyst at Tokyo-based ITR Corporation, attributed Samsung’s bullish forecast to the ongoing AI boom, significantly boosting demand for advanced semiconductor technologies. This trend mirrors broader market enthusiasm, propelling significant indices like the S&P 500 and Nasdaq to new highs.
“The AI boom, which has been a driving force behind Nvidia’s surge, is similarly enhancing Samsung’s earnings and that of the entire industry,” Mr. Einstein noted.
Despite these positive developments, Samsung Electronics faces potential disruption next week as a union of workers plans a three-day strike starting Monday. The strike, which is in protest of [specific issues or demands], could potentially impact Samsung’s operations and financial performance. Employee demands for greater transparency in bonus distribution and time-off policies highlight ongoing labor challenges within the conglomerate.
Samsung Electronics, a cornerstone of the Samsung Group, continues to navigate volatile market conditions by [specific strategies or actions], while capitalizing on burgeoning AI technologies to drive its profitability in the global semiconductor sector.
