Samsung Chips remain in strong demand as Samsung Electronics warned that the global semiconductor shortage could worsen and continue through 2028.
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The company issued the forecast after reporting a more than 250-fold increase in chip operating profit. The strong earnings helped ease investor concerns that slowing artificial intelligence (AI) spending could weaken future growth.
Following the announcement, Samsung shares climbed by as much as 8% before trimming gains to trade 1.1% lower later in the session.
Speaking during an earnings conference call, Jaejune Kim, Executive Vice President of Samsung’s memory business, said supply shortages are expected to intensify in 2027 and continue into 2028.
He added that Samsung has already signed long-term supply agreements with the world’s five largest data centre operators. Moreover, the company is close to finalising similar agreements with five additional major customers.
Although Samsung did not disclose the names of the companies, Kim said the contracts will remain in place for at least five years.
He also explained that the agreements will account for 60% to 70% of Samsung’s long-term production capacity.
Furthermore, the contracts include upfront payments and minimum pricing provisions designed to reduce investment risks associated with expanding manufacturing capacity.
Market analysts welcomed Samsung’s outlook.
Ryu Young-ho, Senior Analyst at NH Investment & Securities, described the company’s guidance as more reassuring than expected. He said management delivered one of its most optimistic conference calls in recent months.
Samsung’s positive outlook comes after global chip stocks declined sharply in recent months.
Investors had raised concerns about future spending on AI infrastructure and growing competition from Chinese semiconductor companies.
However, Samsung’s latest forecast suggests demand for advanced memory chips will remain strong despite those challenges.
