Seoul: Samsung Electronics Co. on Thursday announced a record-breaking operating profit for the fourth quarter, reaching the 20 trillion-won (US$13.8 billion) milestone for the first time. This surge is attributed to a supercycle in the chip market, marking a more than 200 percent increase from the previous year, as revealed in a preliminary earnings report.
According to Yonhap News Agency, if confirmed, this would be the first instance of the company's quarterly earnings hitting the 20 trillion-won benchmark. The company's sales also saw a significant rise, increasing by 22.7 percent to 93 trillion won, surpassing the 90 trillion-won mark for the first time in a quarter. However, data regarding net profit was not disclosed.
The operating profit exceeded the average estimate by 1.8 percent, as per a survey conducted by Yonhap Infomax, the financial data arm of Yonhap News Agency. While Samsung Electronics did not provide a detailed earnings breakdown for its various business divisions, the final earnings report is expected later this month.
Industry analysts suggest that the enhanced earnings are likely due to improved profitability within the Device Solutions (DS) division, which handles Samsung's primary semiconductor operations. Korea Investment and Securities Co. reported a significant rise in global prices of dynamic random-access memory (DRAM) and NAND flash, with a 40 percent increase in the fourth quarter compared to the previous three months.
Market observers estimate that the DS division's operating profit could be between 16 trillion and 17 trillion won, a notable increase from the 7 trillion won reported in the third quarter. Additionally, Samsung's non-memory business is believed to have reduced its operating losses, contributing to the division's overall performance improvement.
Samsung's mobile business is projected to have achieved an operating profit in the 2 trillion-won range, whereas the home appliance sector likely incurred an operating loss of 100 billion won, as per market analysts.
For the year 2025, Samsung Electronics anticipates annual operating earnings of 43.53 trillion won, a 33 percent increase from the prior year. Annual sales rose by 10.6 percent to 332.77 trillion won, though net profit data remains undisclosed.
Looking ahead to 2026, analysts expect Samsung Electronics to uphold its strong performance, bolstered by its expanded high bandwidth memory (HBM) capacity. "This year, Samsung Electronics is expected to post an annual operating profit of 123 trillion won, driven by a sharp rise in DRAM prices and increased HBM shipments," stated Kim Dong-won, a researcher at KB Securities Co.
Kim further mentioned that Samsung's HBM sales are projected to reach 26 trillion won in 2026, tripling from the previous year amid speculation of Samsung entering the supply chain for HBM4 for major tech firms, including Nvidia Corp. and Google.
Choi Jeong-ku from Counterpoint Research indicated that with record-breaking sales, Samsung is poised to make strategic investments in cost innovation, enhancing the company's earnings outlook. "Given the recent increase in memory prices, market expectations for 2026 earnings are likely to rise sharply," Choi added.
Counterpoint Research also predicted another record-breaking performance for Samsung Electronics in the first quarter, aided by the anticipated launch of the Galaxy S26 smartphones. Kim Sun-woo from Meritz Securities noted a new trend among global chipmakers of commencing production after contract agreements, which is expected to further boost Samsung's earnings prospects. "Memory chips are no longer a uniform commodity with the same specifications and prices but a specialty product with differentiated performance," Kim highlighted.
Samsung Electronics' shares were trading at 141,000 won at 1:47 p.m., reflecting a 0.07 percent increase from the previous session.