Samsung Electronics has reported the strongest quarterly result in its history, powered by surging demand for the memory chips that sit at the heart of artificial intelligence systems. The South Korean technology giant said revenue reached KRW 195.3 trillion, around $146 billion, in the third quarter of 2026, while operating profit climbed to KRW 107.4 trillion, about $80.5 billion.
That marks a sharp step up from the previous quarter. Revenue rose by 14 per cent, and operating profit increased by roughly 20 per cent. Samsung said it is the first technology company to report more than KRW 100 trillion in operating profit in a single quarter.
The result is, at its core, a story about two very different businesses inside one company: a chip division enjoying an extraordinary boom, and a smartphone division still struggling to make money.
AI Memory Chips Drive Record Profits
Almost all of the profit came from Samsung’s Device Solutions division, the arm that produces semiconductors and memory chips. That division alone generated KRW 147.1 trillion in revenue and KRW 106.5 trillion in operating profit, setting new quarterly records on both measures and accounting for the overwhelming share of the group’s total earnings.
Samsung attributed the performance to rising demand for high-bandwidth memory, known as HBM4, which is used in artificial intelligence systems, together with strong sales of solid-state drives designed for servers. Samsung said it significantly increased its sales of HBM4 during the quarter, and that strong demand also pushed memory prices higher across different product categories.
That pricing effect matters a great deal in the memory business, which has historically moved in sharp cycles. When supply is tight and demand is strong, producers can charge more for every chip they ship, so profits rise much faster than sales volumes. Samsung expects the trend to continue into the fourth quarter, as new processor platforms increase demand for advanced memory products. For 2027, Samsung expects artificial intelligence-related memory demand to grow faster than industry supply.
Samsung’s Smartphone Business Records Losses
While its semiconductor business achieved record earnings, Samsung’s smartphone division continued to struggle with profitability. Its Mobile eXperience and Networks businesses together reported revenue of KRW 37.7 trillion and an operating loss of KRW 0.6 trillion for the quarter.
That was, at least, an improvement on the previous quarter, when the same divisions generated KRW 33.2 trillion in revenue and recorded a KRW 0.7 trillion operating loss. Samsung said smartphone sales improved following the introduction of new flagship devices, including its foldable models. Higher component costs, however, continued to eat into profitability.
For the final quarter of 2026, Samsung plans to increase sales of the Galaxy S26 series, the Galaxy Z Fold8 and the Galaxy Z Fold8 Ultra during the holiday shopping season. In 2027, the company intends to focus on premium smartphones and to introduce hardware and design improvements intended to strengthen its flagship lineup.
Samsung Expands Investment in Advanced Chips
Samsung also reported improvements in its chip manufacturing business, the foundry operation that makes processors designed by other companies as well as its own. Sales of flagship processors and 200-megapixel camera sensors increased during the quarter, and the company expects further growth from advanced semiconductor manufacturing technologies, particularly its 2-nanometre and 4-nanometre production processes.
The company anticipates double-digit revenue growth in its foundry business during the fourth quarter as it increases production of 4-nanometre neural processing units and other advanced chips. Its new semiconductor manufacturing facility in Taylor, Texas, is expected to begin operations in 2027.
That ambition is reflected in spending. Samsung increased its quarterly capital expenditure to KRW 29 trillion, up KRW 12.2 trillion from the previous quarter. Of that amount, KRW 27.2 trillion went towards its semiconductor business, while KRW 1.1 trillion was allocated to Samsung Display, showing just how heavily the company’s investment programme is now weighted towards chips.
Display Business Reports Higher Earnings
Samsung Display Corporation reported KRW 8 trillion in quarterly revenue and KRW 1.1 trillion in operating profit. The division benefited from strong demand for premium smartphone displays and increased sales of gaming monitors, two markets where buyers are willing to pay more for brighter, sharper and faster screens.
Samsung expects seasonal demand and new product launches to support display sales in the final quarter, although external factors could limit earnings growth. For 2027, the company plans to increase its focus on premium displays, including foldable smartphone panels, a segment in which it supplies both its own handsets and rival phone makers.
Samsung Announces Major Shareholder Payout
Alongside the earnings, Samsung also announced a third-quarter cash dividend of KRW 4,601 per common and preferred share. The total dividend payout will amount to KRW 30 trillion. For the full year, Samsung plans to return between KRW 90 trillion and KRW 110 trillion to shareholders through a combination of cash dividends and share repurchases, and the company expects to finalise its remaining shareholder return plans in January 2027.
Samsung’s latest results highlight the growing importance of artificial intelligence memory chips to its business, even as higher costs continue to put pressure on its smartphone operations. Whether that boom can also rescue the profitability of its phones, the products most consumers associate with the Samsung name, remains the open question hanging over an otherwise record-breaking quarter.
