Samsung says AI to drive technology demand in second half

Samsung Electronics said on Tuesday it expected demand for artificial intelligence to hold strong in the second half, driving sales of memory chips and tech devices, as it reported a more than 10-fold rise in first-quarter operating profit.

The South Korean company’s memory chip sales nearly doubled in the first quarter from a year earlier as prices rose steeply from a severe downturn, thanks to the boom in AI.

Samsung shares were up 1.6% in morning trade, outpacing a 0.5% rise in South Korea’s benchmark index.

The world’s biggest maker of memory chips and TVs said operating profit rose to 6.6 trillion won ($4.8 billion) in January-March, up from 640 billion won a year earlier.

That was in line with Samsung’s own estimate of 6.6 trillion won flagged earlier this month, its highest operating profit since the third quarter of 2022.

First-quarter revenue rose 13% to 71.9 trillion won, the company said, including a 96% increase in memory chip revenue to 17.49 trillion won.

It cemented a recovery from an unprecedented memory chip downturn caused by weak post-pandemic demand for gadgets that use chips.