A huge profit increase by 19-fold and 5 % drop in the stock price of Samsung

According to the revealed information, Samsung's operating profit reached approximately 15 trillion won, a sharp improvement from the previous year's level. This is 6% of increase, and such a number should be significant for the investors. However, the overall market situation barely noticed a 19-fold increase, and everything is evaluated based on the AI chip market. So, the company’s stock price fell by almost 5 %.

Analytics from Constellation Research explain the situation as follows: Samsung is just lagging behind general industry trends, which are in AI, HBM, and contracts with hyperscalers (Microsoft or Google), but not in the general earnings of the company.

Samsung Falls Behind SK Hynix

SK Hynix is a much smaller competitor, but it is the primary supplier of HBM3E to NVIDIA. In contrast, Samsung is not in the supply chain of NVIDIA, which is now the top tech company due to AI.

The global shift towards AI infrastructure seems to be much faster than Samsung was expecting. For instance, during the recent couple of years, NVIDIA tripled its capitalization, and SK Hynix became a critical player in the AI industry.

Production of memory chips for PCs and smartphones is no longer a guarantee for success on the market. Investors are more oriented towards AI and new perspectives. That’s why any high figures in the reports will not increase the profit and interest from the investors.

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