Samsung, SK Hynix Expected to Post Combined Operating Profit Exceeding KRW 180 Trillion in Q3

The anticipated strong financial performance for South Korea's leading memory manufacturers is largely attributed to the expanding requirements of artificial intelligence (AI) computing infrastructure. Next-generation HBM4, designed for advanced AI accelerators like Nvidia's upcoming Vera Rubin platform, is noted as a key contributor. This specialized memory, alongside conventional DRAM used in data centers, is experiencing heightened demand, directly benefiting suppliers.

Market dynamics are reportedly shifting in favor of memory manufacturers. Production capacity is increasingly allocated toward HBM and server DRAM, influencing the supply-demand balance. This trend, combined with rising contract prices for conventional DRAM, estimated by TrendForce to have increased 13% to 18% quarter-on-quarter in Q3, is bolstering profitability. Further price increases of 10% to 15% are forecast for the fourth quarter, suggesting sustained favorable market conditions.

For Samsung Electronics, its memory business is believed to be the primary driver of overall earnings, despite its Device eXperience division and non-memory semiconductor operations reportedly facing profitability pressures. Securities analysts also estimate Samsung's foundry business may have recorded an operating loss of approximately KRW 1 trillion in the third quarter.

Looking ahead, Meritz Securities forecasts significant increases in mobile memory selling prices, potentially over 50% quarter-on-quarter starting next year for major customers. Should these materialize, they would extend margin improvements beyond AI-related products. However, higher memory prices could increase costs for smartphone manufacturers, which might influence demand and customer inventory strategies.