Samsung Electronics projects a 15-fold increase in profits for the April-June 2024 quarter compared to the same period last year. This surge is driven by a robust demand for advanced chips amidst an AI boom, propelling the firm’s second-quarter outlook. As the world’s largest producer of memory chips, smartphones, and televisions, Samsung’s announcement initially boosted its shares by over 2% in early trading in Seoul.
Earlier this year, the company reported a more than 10-fold rise in profits for the first quarter, projecting a profit of 10.4 trillion won ($7.54 billion) for the current quarter, up from 670 billion won last year, surpassing analysts’ expectations. The soaring demand for AI chips in data centers and smartphones has been a significant factor, according to Marc Einstein, chief analyst at ITR Corporation in Tokyo.
The optimism surrounding AI technology has also driven broader market rallies, with major indices like the S&P 500 and Nasdaq reaching new highs. Nvidia, a leader in chip-making, briefly held the title of the world’s most valuable company last month, bolstered by the AI-driven market surge.
However, Samsung Electronics faces potential challenges next week as a workers’ union plans a three-day strike starting Monday. The union’s demands include a more transparent system for bonuses and time off at the South Korean conglomerate’s flagship unit.
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