Samsung Electronics has posted record profits after AI-driven demand for high-bandwidth memory chips tripled earnings, while the resulting memory shortage begins to push up costs across smartphones and other consumer devices.
Samsung Electronics has posted a record-breaking quarter, with profits more than tripling as surging demand for artificial intelligence hardware drives a global shortage of advanced memory chips.
The South Korean tech giant reported operating profit of 20.1 trillion won ($15.3 billion) for the fourth quarter of 2025, up more than 200 per cent year-on-year and ahead of analyst expectations.
Revenue rose 24 per cent to a record 93.8 trillion won, underlining the scale of the rebound after a prolonged downturn in the memory market.
The standout performer was Samsung’s semiconductor business, where soaring prices and tight supply of high-bandwidth memory (HBM) chips lifted earnings to all-time highs.
HBM is a critical component in AI servers used by companies such as Nvidia, and demand continues to outstrip supply as cloud providers race to expand data centre capacity.
Samsung said strong sales of HBM and other high-value memory products were the primary drivers behind the profit surge.
That imbalance is now rippling through the wider electronics industry.
As memory makers prioritise capacity for AI workloads, supplies of DRAM and NAND used in PCs, smartphones and consumer devices have tightened, pushing prices higher.
While this has boosted margins for Samsung and rival SK Hynix, it is also creating cost pressure elsewhere in Samsung’s business.
Executives warned that rising memory and component prices are beginning to weigh on smartphones and displays.
Samsung’s mobile division posted weaker results in the quarter, with operating profit falling 9.5 per cent year-on-year to 1.9 trillion won, citing softer demand following recent flagship launches and fierce competition.
Despite the near-term pressure, Samsung remains bullish, as. the company said AI and server demand is expected to grow further into 2026, and it plans to increase memory investment after taking a conservative approach to capital spending last year.
At the same time, Samsung is preparing to push “agentic AI” features more aggressively in its next Galaxy S26 smartphones, while leaning on supplier partnerships to manage higher costs.
Samsung sees profits triple as rampant AI chip demand deepens memory shortage
