Shares hit 52-week high as earnings beat forecasts

Samsung Electronics office building in southern Seoul (Yonhap)
Samsung Electronics office building in southern Seoul (Yonhap)

Samsung Electronics reported robust third-quarter earnings on Thursday, with operating profit rising to 12.17 trillion won ($8.57 billion), a 32.5 percent increase from a year earlier. Quarterly sales reached a record high of 86.62 trillion won, reflecting 8.8 percent on-year growth.

Net profit for the July-September period amounted to 12.22 trillion won, marking a 21 percent increase compared to the same period last year. The result exceeded market expectations, with FnGuide's consensus forecast predicting an operating profit of 10.14 trillion won and sales of 84.13 trillion won.

The company’s semiconductor business, part of its device solutions division, posted a strong performance, with operating profit of 7 trillion won and sales of 33.1 trillion won. The memory sector set a new record for quarterly revenue, driven by rising demand for fifth-generation HBM3E chips, DDR5 and solid-state drives for servers. Operating profit saw an increase, supported by higher product prices and reduced one-time inventory costs compared to the previous quarter.

Samsung’s HBM3E line, strategically supplied to Nvidia, has now entered mass production for all customers. The company also revealed that samples of its upcoming sixth-generation HBM4 chips have been distributed to all interested clients.

In a conference call following the earnings report, Samsung highlighted nearly 80 percent growth in HBM sales from the previous quarter, with HBM3E now fully replacing older products. The company anticipates a surge in HBM demand in 2026, having already secured customer orders, and is exploring ways to expand production capacity to meet that growing demand.

The foundry division achieved record orders for advanced process technologies, with improved line utilization and reduced one-time costs contributing to stronger results than the previous quarter.

The device experience division, which includes mobile, TV and home appliance sectors, also posted impressive results. The successful launch of new foldable models and strong sales of flagship smartphones helped generate an operating profit of 3.5 trillion won and revenue of 48.4 trillion won.

The mobile experience division saw gains in both operating profit and sales, driven by Galaxy Z Fold7 smartphone sales. However, the video display division, which includes premium products such as Neo QLED and OLED TVs, faced stagnation in demand and heightened competition, leading to a decline in quarterly performance.

The home appliances business saw a drop in operating profit due to the seasonal off-peak period and the impact of US tariffs. On a more positive note, Harman International, Samsung’s consumer audio and automotive business, experienced strong growth, with operating profit at 400 billion won and sales reaching 4 trillion won.

Samsung’s display business also delivered solid results, with strong demand for flagship smartphones pushing operating profit to 1.2 trillion won and sales reaching 8.1 trillion won.

Looking ahead, Samsung plans to allocate a record 26.9 trillion won for research and development in the fourth quarter, marking the highest amount ever spent in a single quarter. The company also intends to invest 47.4 trillion won in facilities throughout this year, with 40.9 trillion won designated for the device solutions division and 3.3 trillion won earmarked for Samsung Display.

Shares of Samsung Electronics closed at 104,100 won on Thursday, up 3.58 percent from the previous session's close. During intraday trading, the stock surged as much as 5.27 percent to reach 105,800 won, marking a fresh 52-week high.


yeeun@heraldcorp.com