Samsung Electronics reported another record quarter in Q2 2026 as surging demand for AI infrastructure and memory chips powered its semiconductor business, while smartphones faced higher component costs.
Revenue of Samsung reached an all-time high of KRW 171.5 trillion, rising 28 percent quarter on quarter, while operating profit climbed to a record KRW 89.5 trillion.
Device Solutions (DS) semiconductor division was the main growth engine, with sales jumping 56 percent quarter on quarter. DS generated KRW 127.5 trillion in revenue and KRW 89.2 trillion in operating profit, meaning semiconductors accounted for roughly three-quarters of Samsung’s consolidated quarterly revenue. In contrast, sales at the Device eXperience division declined 9 percent quarter on quarter.
AI investment is fundamentally reshaping Samsung’s chip business. The Memory Business achieved record quarterly revenue and operating profit, supported by AI-related server demand, constrained industry capacity and higher memory prices. Server products reached a record-high share of the memory sales mix, while Samsung increased HBM4 sales and shipped what it described as the industry’s first HBM4E samples to major customers. During the first half of 2026, Samsung also expanded penetration of PCIe Gen6 and UFS 5.0 products.
Samsung expects the AI infrastructure investment cycle to remain a major semiconductor growth driver during the second half of 2026. Continued AI infrastructure capex and broader agentic AI adoption are expected to accelerate demand for server DRAM, enterprise SSDs and HBM. Samsung expects supply constraints to continue despite softer demand from smartphones and PCs, and plans to prioritize higher-value products including HBM4, DDR5 and SOCAMM2.
Orders also strengthened across Samsung’s semiconductor operations. The System LSI Business secured orders for a next-generation flagship smartphone SoC and added new business from major customers. Despite weak mobile demand in China and flagship seasonality, expanded sales of high-volume mobile SoCs and image sensors pushed System LSI’s first-half revenue to a record high.
Samsung’s Foundry Business benefited from HBM base-die demand and strong U.S. customer orders, while design wins with major customers continued to expand. Samsung specifically highlighted 2nm high-performance computing engagements. During H2 2026, it plans to ramp production of new mobile chips using its second-generation 2nm process and increase sales of LPU and HBM base-die products manufactured on 4nm technology. With demand increasing across process nodes from U.S. and Chinese customers, Samsung is targeting double-digit foundry revenue growth and additional AI and HPC design wins.
The smartphone and telecom equipment operations produced a more mixed performance. The Mobile eXperience (MX) and Networks businesses generated KRW 33.2 trillion in revenue but recorded a KRW 0.7 trillion operating loss. Revenue increased year over year, helped by solid Galaxy S26 series sales and strong momentum for the Galaxy A series, but higher industry-wide component costs pressured profitability.
In Q2 2026, the Networks Business reported an improvement in earnings QoQ and YoY, supported by overseas sales expansion. In H2 2026, the Business aims to secure profitability through new orders and structural cost discipline amid telco investment headwinds.
Omdia report indicated that Samsung was the largest smartphone vendor in Q2-2026 with 22 percent share in the global smartphone market. Samsung has enhanced its smartphone share from 20 percent in Q2-2025 as it gained ground in the budget segment beating Android smartphones from China.
Samsung plans to use AI as an important smartphone growth lever in H2 2026, emphasizing personalized AI experiences while expanding flagship sales around the Galaxy Z8 and Galaxy S26 series. It also plans to introduce AI experiences through new device categories including Intelligent Eyewear. The Networks Business improved earnings both sequentially and year over year in Q2 on overseas sales growth and will focus on securing new orders during H2 despite continued telecom operator investment headwinds.
Samsung Display Corporation generated KRW 7.5 trillion in revenue and KRW 0.7 trillion in operating profit. Earnings in small and medium displays improved on strong high-end mobile OLED demand, while large-display revenue benefited from gaming monitors. Samsung Display plans to start timely mass production at its 8.6G IT OLED line, expanding opportunities across tablets, gaming devices and automotive displays while continuing to target premium smartphones.
The Visual Display and Digital Appliances businesses recorded KRW 14.5 trillion in combined revenue and a slight operating loss. Samsung plans to expand its position in AI TVs through Vision AI, while Digital Appliances will increase sales of AI-enabled products. Harman also improved earnings as automotive and portable-audio sales expanded, with future growth focused partly on automotive central compute units.
Overall, Samsung’s Q2 2026 figures show an increasingly AI-driven business mix. The KRW 127.5 trillion DS semiconductor division overwhelmingly drove the company’s record KRW 171.5 trillion revenue, while record memory results, HBM4 expansion, HBM4E samples, 2nm HPC design wins and strong foundry orders demonstrate how investment by cloud and AI infrastructure customers is translating into semiconductor demand. Meanwhile, Samsung is extending AI beyond chips into Galaxy smartphones, Intelligent Eyewear, TVs and home appliances, positioning AI as a growth driver across multiple business divisions.
BABURAJAN KIZHAKEDATH
