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Samsung Electronics is reporting a dramatic turnaround in its semiconductor business, as AI‑driven demand pushes memory prices sharply higher and the company’s advanced P4 memory fab in Pyeongtaek nears completion to boost supply of 1c‑node DRAM and HBM4 chips. The surge in memory profits is reshaping Samsung’s earnings profile and reinforcing its strategic bet on artificial intelligence and data‑center expansion worldwide.

As per Astute Analytica, semiconductor manufacturing equipment market was valued at US$ 93.03 billion in 2024 and is projected to attain a valuation of US$ 224.44 billion by 2033 at a CAGR of 10.28% during the forecast period 2025–2033.

Record profit jump anchored in memory

Samsung estimates that its Q1 2026 operating profit will reach about 57.2 trillion won (approximately $38 billion), more than eight times higher than the same quarter in 2025. This record jump is being driven overwhelmingly by its semiconductor division, with memory chips—especially DRAM and NAND—accounting for the lion’s share of the gain.

Analysts note that the semiconductor arm is now the primary profit engine of the conglomerate, with memory sales not only recovering from a post‑pandemic downturn but reaching new peaks as AI‑centric customers lock in long‑term supply agreements.

AI‑driven demand tightens memory market

Memory‑chip prices have climbed steeply since 2025, with data‑center‑oriented DRAM and NAND seeing price gains estimated in the range of 50–100% over the course of the cycle. The rise is linked to a structural shift in demand: hyperscalers and AI‑chip makers are building out massive data‑center infrastructure to support generative AI models, machine‑learning training farms, and high‑performance computing workloads.

In this environment, Samsung’s high‑bandwidth memory (HBM3E and HBM4) and AI‑optimized DRAM and NAND have become particularly valuable. Shortages of these specialty memory products have given Samsung strong pricing power, allowing the company to fill its fabs at premium rates while maintaining healthy margins.

P4 fab and 1c‑node DRAM expansion

At the heart of Samsung’s strategy is the P4 memory fab at its Pyeongtaek Campus, which is being converted into a next‑generation memory hub. Initially focused on 1c‑node DRAM (sub‑11 nm, 10nm‑class 6th‑gen), the line will later pivot to HBM4 stacks built on 1c‑DRAM dies, directly targeting the AI‑accelerator market.

The company aims to scale 1c‑node DRAM capacity to roughly 200,000 wafers per month by the end of 2026, with P4 playing a central role in that expansion. If achieved, 1c‑node memory would account for about one‑third of Samsung’s total DRAM output, a significant increase from its earlier share and a clear signal of Samsung’s long‑term commitment to leading‑edge memory technology.

Strategic role in AI‑chip supply chains

Samsung’s HBM4 chips are positioned to serve leading AI‑accelerator vendors, including Nvidia, AMD, and other GPU and AI chip designers. By embedding its 1c‑node DRAM into high‑bandwidth stacks that feed these accelerators, Samsung is becoming a core supplier in the AI‑chip supply chain.

This positioning is critical because HBM allows AI chips to access memory at much higher bandwidth and lower latency than conventional DRAM, directly impacting the performance of large language models and other AI workloads. As a result, Samsung’s ability to ramp HBM4 production at P4 is seen as a strategic lever in its competition with rivals such as SK hynix and Micron.

Market and financial impact

The surge in memory profits has lifted Samsung’s overall operating margin and reshaped investor sentiment. Shares have risen strongly following the Q1 profit guidance, with markets reacting positively to the combination of AI‑driven pricing strength and incremental capacity coming from P4 and other advanced fabs.

Analysts at Astute Analytica expect Samsung to remain heavily reliant on AI‑related memory sales through 2026–2027. The company’s bet on 1c‑node DRAM and HBM4, combined with its price leadership in a tight market, is widely viewed as a structural move rather than a short‑term cycle play.