How AI Demand Revived Samsung’s Semiconductor Business
402After experiencing four straight quarterly declines, Samsung’s semiconductor division finally turned a corner in the third quarter of 2025. The company reported an operating profit of KRW 12.2 trillion (about US$8.6 billion), more than doubling its profit from the previous quarter. This rebound is largely thanks to a boost in sales from Samsung’s Device Solutions division, which saw revenue hit KRW 33.1 trillion and operating profit reach KRW 7.0 trillion — a tenfold jump from the June quarter. The memory chip business also hit a new high, driven by increased sales of high-bandwidth memory (HBM3E) chips and server SSDs, both vital for AI infrastructure development. But behind this recovery are strategic moves and market shifts that helped Samsung bounce back from a tough period.
The Road to Recovery
Throughout 2024 and early 2025, Samsung faced tough challenges. The memory chip market was flooded with excess supply, causing prices to plummet. At the same time, Samsung struggled with delays in qualifying its HBM products with major customers. Rival SK Hynix gained early leadership in AI-specific memory chips, adding to Samsung’s difficulties. The low point came in the second quarter of 2025, when Samsung’s chip division reported weak profits that made analysts question whether the company still had its technological edge. Despite these setbacks, Samsung’s leadership and industry experts believed the company could recover.
Research director Hwang from Counterpoint Research noted that Samsung’s strong third-quarter results were largely due to a broader memory market boom and rising prices for general-purpose memory. Interestingly, Samsung had also managed to reclaim the top spot in the memory market from SK Hynix during this period. This suggests that Samsung’s comeback was driven not just by favorable market conditions but also by strategic efforts to regain leadership and innovate in key areas.
Revamping High-Bandwidth Memory
A key part of Samsung’s turnaround was its progress with high-bandwidth memory, or HBM. The company confirmed that HBM3E is now in mass production and being sold to all relevant customers. Meanwhile, Samsung is also shipping early samples of HBM4 to major clients. Reports emerged that Samsung passed Nvidia’s qualification tests for its advanced HBM chips — an important milestone after months of delays. Although Samsung hasn’t officially confirmed this, the timing aligns with the increased sales reflected in the recent quarterly results. This progress in HBM technology is crucial for AI applications, which require fast, high-capacity memory chips.
The ability to produce and sell these advanced memory chips has helped Samsung better serve the growing AI hardware market. As demand for AI infrastructure continues to rise, Samsung’s push into high-performance memory positions it well for future growth. The company’s focus on accelerating its AI chip roadmap and improving its memory products shows a clear strategy to stay ahead in this competitive space.
Overall, Samsung’s semiconductor recovery highlights the importance of strategic innovation and market responsiveness. By overcoming market challenges and investing in cutting-edge technology, Samsung is setting itself up for a promising future in the AI-driven tech landscape.
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