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Samsung second-quarter operating profit soars 1,458% as AI demand remains strong; results top estimates

Jul 31, 2024 - news.bensbites.com
Samsung Electronics reported higher-than-expected Q2 revenue and operating profit, driven by strong demand for its advanced memory chips used in AI training. Revenue for the quarter was 74.07 trillion Korean won (about $53.45 billion), up 23.42% from a year earlier, while operating profit soared 1,458.2%. The South Korean tech giant expects demand from server AI to remain strong, contributing to the performance. However, expanding capacity to meet demand could further constrain the supply of conventional memory chips.

On the other hand, Samsung's smartphone sales declined in Q2 due to the "base effect of launches of new models" in Q1. The company expects the premium segment to grow in the second half, though the mass segment is likely to see a slowdown. Profitability in the smartphone business also dropped as prices of key components rose. Despite this, Samsung plans to continue pushing its premium Galaxy AI products and announced the global availability of its newest Galaxy devices.

Key takeaways:

  • Samsung Electronics reported higher-than-expected second-quarter revenue and operating profit, driven by strong demand for its advanced memory chips used in artificial intelligence training.
  • The company's revenue for the quarter ended June jumped 23.42% from a year earlier, while operating profit soared 1,458.2%.
  • Samsung expects the demand from server AI to stay strong across server products including HBM and SSD, and plans to expand capacity to meet this demand.
  • Despite a decline in smartphone sales in the second quarter, Samsung plans to continue pushing its premium Galaxy AI products and announced global availability for its newest Galaxy devices.
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