Samsung, the world’s largest maker of memory chips, smartphones, and televisions, expects its profits for the second quarter of 2024 to surge by more than 1,400% compared to the same period last year, driven by the artificial intelligence (AI) boom that has lifted the prices of advanced chips.
Key factors behind the profit jump: The widespread adoption of AI has led to a significant increase in demand for advanced computer chips, which has positively impacted Samsung’s forecast:
- The company reported a more than 10-fold jump in its profits for the first three months of this year, and it expects its profit for the second quarter to rise to 10.4tn won ($7.54bn; £5.9bn), surpassing analysts’ forecasts.
- The AI boom, which has massively boosted companies like Nvidia, is also driving up earnings for Samsung and the entire semiconductor sector.
Market reaction and broader impact: The announcement of the expected profit surge has had an immediate effect on Samsung’s stock and highlights the broader market rally driven by optimism about AI:
- Samsung shares rose more than 2% during early trading hours in Seoul following the announcement.
- The AI-driven market rally has pushed the S&P 500 and the Nasdaq in the United States to new records, with chip-making giant Nvidia briefly holding the top spot as the world’s most valuable company.
Potential challenges ahead: Despite the positive outlook, Samsung Electronics faces a possible three-day strike next week, which could impact its operations:
- A union of workers is demanding a more transparent system for bonuses and time off, with the strike expected to start on Monday.
- The outcome of the strike and its potential impact on Samsung’s production and profits remain to be seen.
Analyzing the bigger picture: The AI boom has significantly boosted the semiconductor industry, with companies like Samsung and Nvidia reaping the benefits of increased demand for advanced chips. As AI continues to gain traction across various sectors, the demand for these chips is likely to grow further. However, the industry may face challenges, such as potential supply chain disruptions and labor disputes, which could impact the short-term performance of companies like Samsung. The long-term success of these firms will depend on their ability to navigate these challenges while continuing to innovate and meet the growing demand for AI-related hardware.
Recent Stories
DOE fusion roadmap targets 2030s commercial deployment as AI drives $9B investment
The Department of Energy has released a new roadmap targeting commercial-scale fusion power deployment by the mid-2030s, though the plan lacks specific funding commitments and relies on scientific breakthroughs that have eluded researchers for decades. The strategy emphasizes public-private partnerships and positions AI as both a research tool and motivation for developing fusion energy to meet data centers' growing electricity demands. The big picture: The DOE's roadmap aims to "deliver the public infrastructure that supports the fusion private sector scale up in the 2030s," but acknowledges it cannot commit to specific funding levels and remains subject to Congressional appropriations. Why...
Oct 17, 2025Tying it all together: Credo’s purple cables power the $4B AI data center boom
Credo, a Silicon Valley semiconductor company specializing in data center cables and chips, has seen its stock price more than double this year to $143.61, following a 245% surge in 2024. The company's signature purple cables, which cost between $300-$500 each, have become essential infrastructure for AI data centers, positioning Credo to capitalize on the trillion-dollar AI infrastructure expansion as hyperscalers like Amazon, Microsoft, and Elon Musk's xAI rapidly build out massive computing facilities. What you should know: Credo's active electrical cables (AECs) are becoming indispensable for connecting the massive GPU clusters required for AI training and inference. The company...
Oct 17, 2025Vatican launches Latin American AI network for human development
The Vatican hosted a two-day conference bringing together 50 global experts to explore how artificial intelligence can advance peace, social justice, and human development. The event launched the Latin American AI Network for Integral Human Development and established principles for ethical AI governance that prioritize human dignity over technological advancement. What you should know: The Pontifical Academy of Social Sciences, the Vatican's research body for social issues, organized the "Digital Rerum Novarum" conference on October 16-17, combining academic research with practical AI applications. Participants included leading experts from MIT, Microsoft, Columbia University, the UN, and major European institutions. The conference...