Samsung says chips to recover in 2024 after best quarterly profit this year

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SEOUL: Samsung Electronics on Tuesday (Oct 31) flagged a gradual recovery in demand in 2024 after reporting its highest quarterly profit so far this year, as the battered memory chip market began showing signs of a rebound from a severe downturn.

The proliferation of on-device artificial intelligence functions will increase the appetite for DRAM chips in premium products in 2024, the world's biggest memory chip and smartphone maker said in a statement.

Although profit fell 78 per cent from 10.85 trillion won a year earlier, it was higher than the first quarter's 640 billion won and the second quarter's 670 billion won. Reflecting improving demand, some memory chip prices rebounded toward the end of the third quarter, while in September, overall factory output in South Korea rose for a second consecutive month helped by increasing chip production.Cross-town rival SK Hynix last week said an AI boom is driving demand in DRAM chips while the effects of memory chipmakers' production cuts are starting to show as clients are placing new orders and chip prices are beginning to stabilise.

Samsung said on Tuesday it expects to spend a record 53.7 trillion won in capital expenditure this year, including 47.5 trillion won on chips, to prepare for mid-to-long-term demand increase.

 

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