Samsung, SK Hynix Set for Combined $107 Billion Operating Profit in Second Quarter

Samsung, SK Hynix poised for another second-quarter earnings surprise

Server memory shortages drive sharp price increases

China’s advances remain a risk despite dominance of the top two

Expectations are building that Samsung Electronics Co. and SK Hynix Inc. will deliver another round of record second-quarter results. As investment in artificial intelligence servers lifts memory-chip prices, the two companies are projected to post nearly 150 trillion won, or about $108 billion, in combined operating profit for the quarter.

Hankyung Epic AI consensus data compiled on June 30 show Samsung is projected to post second-quarter revenue of 169.9616 trillion won, or about $123 billion, and operating profit of 85.0546 trillion won, or about $61.6 billion. That would be up 127.9% and 1,718.9%, respectively, from a year earlier. Operating margin is forecast at 50%.

In the first quarter, Samsung posted revenue of 133.8734 trillion won, or about $97 billion, up 69.2% from a year earlier, and operating profit of 57.2328 trillion won, or about $41.5 billion, up 756.1%.

The semiconductor business is driving the gains. Samsung’s Device Solutions division is estimated to have generated second-quarter revenue of 122.1617 trillion won, or about $88.5 billion, and operating profit of 83.8621 trillion won, or about $60.8 billion. Memory alone is expected to contribute operating profit of 84.6428 trillion won, or about $61.3 billion, including 64.4775 trillion won, or about $46.7 billion, from DRAM and 20.9066 trillion won, or about $15.1 billion, from NAND.

Samsung’s foundry business is forecast to post an operating loss of 988.8 billion won, or about $717 million. Some market participants also say a larger-than-expected accrual for performance bonuses could weigh on profit in the quarter.

Estimates for SK Hynix have also moved higher. The company is projected to report second-quarter revenue of 82.9467 trillion won, or about $60.1 billion, and operating profit of 63.3651 trillion won, or about $45.9 billion. That would mark year-over-year increases of 273.1% in revenue and 587.8% in operating profit. Its operating margin is forecast at 76.4%.

In the first quarter, SK Hynix posted revenue of 52.5763 trillion won, or about $38.1 billion, up 198.1% from a year earlier, and operating profit of 37.6103 trillion won, or about $27.3 billion, up 405.5%.

DRAM is expected to account for most of SK Hynix’s earnings. Second-quarter DRAM operating profit is projected at 50.3553 trillion won, or about $36.5 billion, while NAND operating profit is seen at 13.0198 trillion won, or about $9.4 billion. That brings the two companies’ combined second-quarter operating profit forecast to 148.4197 trillion won, or about $107 billion.

Full-year estimates have also risen sharply. Samsung is projected to post 2026 revenue of 704.2969 trillion won, or about $510.4 billion, and operating profit of 363.4528 trillion won, or about $263.4 billion. SK Hynix is expected to generate revenue of 346.8686 trillion won, or about $251.4 billion, and operating profit of 266.4417 trillion won, or about $193.1 billion. Their combined operating profit for the year is estimated at 629.8945 trillion won, or about $456.4 billion.

The stronger earnings outlook reflects both rising memory demand and higher prices. Continued investment in AI infrastructure has boosted demand for server memory, while prices for DRAM, NAND and high-bandwidth memory, or HBM, have all climbed.

Counterpoint Research projects the global memory market will quadruple from a year earlier to 1,500 trillion won, or about $1.09 trillion, this year. It sees the market expanding to 2,100 trillion won, or about $1.52 trillion, next year. The firm said ongoing AI infrastructure demand, tight server-memory supply and rapid price gains are driving that expansion.

Server products are also accounting for a larger share of the market. Counterpoint Research estimates server products will make up 56% of total memory revenue this year, up from 37% last year. With demand concentrated in higher-value products, the price per gigabit of some commodity DRAM products has reportedly risen above that of HBM.

“The structural shift toward server products accounting for more than half of memory revenue is acting as the key driver of growth in the memory market,” Counterpoint Research said. “HBM, which involves more complex processes and higher manufacturing costs, also has strong potential for further price increases, leaving ample room for additional market growth.”

Samsung and SK Hynix remain leaders across major product categories in the global memory market. In the first quarter, Samsung led the global DRAM market with a 38% revenue share. SK Hynix was second at 29%, followed by Micron Technology Inc. at 22%.

Samsung also led the NAND market with a 29% share, followed by SK Hynix at 18%. In HBM, SK Hynix held the top spot with a 58% share, while Samsung and Micron each had 21%.

The growing share of Chinese rivals remains a key variable. In DRAM, ChangXin Memory Technologies, or CXMT, increased its market share to 8% in the first quarter from 3% a year earlier. In NAND, Yangtze Memory Technologies, or YMTC, lifted its share to 13% from 8% over the same period. Tight supply and higher prices in memory appear to have also helped Chinese companies gain ground.

As long as AI infrastructure investment continues, the market expects memory demand to remain firm for now. Jeong Eui-hyun, head of ETF management at Mirae Asset Global Investments, said in a June 29 webinar that Samsung and SK Hynix are leading the global AI memory market as competition in next-generation HBM intensifies. He added that memory demand will continue to grow as global big tech companies expand AI infrastructure spending.

Hong Min-seong, Hankyung.com reporter mshong@hankyung.com