[Financial News] Samsung Electronics Co., Ltd. posted record results in the third quarter of this year, buoyed by growing demand for artificial intelligence (AI) semiconductors. Strong sales of high-bandwidth memory (HBM) and server solid-state drives (SSDs) helped the company earn more than 106 trillion won in operating profit from its semiconductor business alone. The first global tech company to surpass 100 trillion won in quarterly operating profit, Samsung Electronics plans to strengthen its lead in the AI semiconductor market next year by moving beyond HBM4 (sixth generation) to begin mass production of HBM4E (seventh generation) and ramp up operations at its Taylor foundry in the United States. Semiconductor operating profit reaches 106 trillion won on strong HBM4 and server SSD sales Samsung Electronics announced on the 29th that it recorded consolidated revenue of 195.2532 trillion won and operating profit of 107.4405 trillion won in the third quarter of this year. The figures were up 126.88% and 783.11%, respectively, from the same period a year earlier. Compared with the previous quarter, revenue rose 14% and operating profit increased 20%. This marked the fourth consecutive quarter in which the company set all-time highs for both revenue and operating profit. The growth was led by the Device Solutions (DS) Division, which oversees the semiconductor business. The division posted record quarterly results, with revenue of 147.1 trillion won and operating profit of 106.5 trillion won in the third quarter. This came as memory demand surged on increased investment in AI infrastructure, while the company substantially expanded sales of HBM4 (sixth generation) and actively responded to rising demand for server SSDs. The non-memory business also grew. The System LSI Business increased revenue by supplying system-on-chips (SoCs) and image sensors for new products in the second half of the year. Partnerships with new customers also helped flesh out its custom SoC business. The Foundry Business significantly improved its results on higher sales of HBM base dies and growing demand from global customers for advanced process technologies. It continued to secure orders, particularly from customers for 2-nanometer-based high-performance computing (HPC), including large hyperscalers. By contrast, the Device eXperience (DX) Division, which oversees smartphones and home appliances, recorded revenue of 52.1 trillion won and an operating loss of 800 billion won. Revenue increased from a year earlier thanks to the launch of premium new products such as the Samsung Galaxy Z Fold 8, but higher memory prices put pressure on costs and weighed on profitability. The network business's results declined as revenue fell in North America and from software, while profits in home appliances also decreased due to higher raw material and logistics costs. The display business recorded revenue of 8 trillion won and operating profit of 1.1 trillion won. Results for small- and mid-sized panels improved on increased supplies for new products from major customers, while large panels also became more profitable through sales of high-value-added products and cost reductions. Harman posted revenue of 4.3 trillion won and operating profit of 600 billion won, buoyed by strong sales of automotive electronics and audio products. HBM4E mass production and Taylor plant operations to ramp up next year Samsung Electronics forecast that growth would continue in the fourth quarter as demand for AI semiconductors remained strong. It expects demand to broaden across memory products—not only HBM but also server DRAM and NAND flash memory (NAND)—as adoption of agentic AI accelerates. Accordingly, the DS Division plans to expand sales of high-value-added products such as HBM4, high-performance DDR5 and SSDs based on quad-level cell (QLC) technology. The Foundry Business also plans to expand mass production on its 4-nanometer and 2-nanometer leading-edge processes, sustaining revenue growth and improving profitability. Samsung Electronics expects strong conditions in the semiconductor industry to continue next year. It believes demand will significantly outstrip supply as global investment in AI infrastructure continues over the long term while semiconductor supply increases only modestly. To respond to these market conditions, Samsung Electronics plans to further expand HBM4 sales next year and begin mass production of its next-generation product, HBM4E. It aims to boost profitability by strengthening its sales strategy around high-value-added memory products, including high-performance DDR5. In its foundry business, the company will ramp up operations at its Taylor plant in Texas, U.S., and mass production of 2-nanometer AI and HPC semiconductors. It plans to step up efforts to secure major global customers and strengthen its competitiveness in advanced processes. Large-scale capital investment will continue. Samsung Electronics set its annual capital expenditure for this year at 84.4 trillion won. Of that amount, 76.8 trillion won will go to the DS Division and 3.9 trillion won to display. The memory business will invest in infrastructure, including new semiconductor factories, to meet growing AI demand and secure production capacity over the medium to long term. The Foundry Business plans to increase investment, particularly around its Taylor plant in the United States, to meet the growth of the AI and HPC markets and customer demand. Meanwhile, Samsung Electronics decided to pay a cash dividend of 4,601 won per share for the third quarter of this year. Total dividends will amount to 30 trillion won. Total shareholder returns for the year are expected to range from 90 trillion to 110 trillion won, with the remaining 55 trillion to 75 trillion won to be used for cash dividends, share buybacks and cancellations. The specific plan will be finalized at a board meeting in late January next year. [email protected] Lim Su-bin Reporter