Samsung Expects 15x Q2 2024 Profit Surge Amid AI Chip Demand Boom

Samsung Expects 15x Q2 2024 Profit Surge Amid AI Chip Demand Boom

Samsung is on track to achieve unprecedented financial growth in the second quarter of 2024, fueled by the skyrocketing demand for AI-related chips. Following its remarkable Q1 2024 performance, where the company saw a staggering 933 percent increase in operating profit compared to Q1 2023, Samsung anticipates even greater rewards this quarter. In its Q2 2024 guidance, the tech giant projects a 15-fold rise in operating profit, largely due to the rebound in semiconductor prices driven by the AI boom.

Projected Operating Profit Soars to $7.54 Billion

2023 was a challenging year for Samsung, with declining chip demand impacting its financial performance. However, the growing trend towards artificial intelligence has shifted the market dynamics. Technology companies are now heavily investing in AI, significantly increasing their chip requirements. This surge in demand has positioned Samsung to capitalize on the trend, with the company forecasting an operating profit between 10.3 trillion and 10.5 trillion won, approximately $7.54 billion.

Comparative Analysis with Previous Year’s Performance

A year ago, Samsung reported an operating profit of just 670 billion won, or around $509.2 million. The dramatic turnaround is evident when comparing these figures to the anticipated Q2 2024 profits. In Q1 2024, the Galaxy S24 series accounted for a substantial 53 percent of Samsung’s total net earnings, benefiting from the new flagship models’ recent launch across multiple regions. As these smartphones are now established in the market, it will be interesting to see if consumer enthusiasm for upgrades remains consistent.

Revenue Growth and Upcoming Announcements

Samsung estimates a 23 percent increase in Q2 revenue, reaching 74 trillion won. A detailed financial report will be provided during the earnings call on July 31. Additionally, Samsung is poised to unveil its latest foldable flagships soon, though their sales impact will likely not be reflected in this quarter’s earnings.

This substantial growth highlights Samsung’s strategic positioning in the AI and semiconductor markets, ensuring robust financial health and continued market leadership. With AI technology advancing rapidly, Samsung’s focus on meeting the escalating demand for high-performance chips positions it well for sustained future success.

By leveraging the AI boom and rebounding semiconductor prices, Samsung is set to achieve an extraordinary Q2 2024 performance, reinforcing its stature as a global tech leader.

Source: Samsung