Samsung Electronics has gone past a $1 trillion market value, which is a big success for the South Korean technology company as demand for AI chips is rising very fast. This achievement puts Samsung in a special group where only Taiwan Semiconductor Manufacturing Co.
(TSMC) is the other Asian company to reach this level. On Wednesday, Samsung’s shares increased by as much as 15 percent, and over the past year, the stock price has become nearly four times higher. This rise also pushed South Korea’s main Kospi index up by more than 6 percent, taking it past 7,000 points for the first time.
The main reason behind this growth is Samsung’s position as the world’s largest maker of memory chips. There is very high demand for chips used in artificial intelligence, which has brought huge profits, especially in its semiconductor business. In the March quarter, earnings from this division increased 48 times compared to before.
This happened because of large orders from AI data centers and limited supply, which kept prices high. Experts believe that memory chips like DRAM and NAND will remain in short supply until 2027, and their prices may rise further. This is not just temporary but seen as a long-term change where Asia is leading the global AI market, along with companies like SK Hynix.
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Foreign investors played a big role in Wednesday’s market rise, investing a net $2.1 billion into Kospi stocks. A new agreement between Interactive Brokers and Samsung Securities now allows US investors to easily buy Korean stocks, increasing investments further.
The South Korean won also became stronger by more than 1 percent against the US dollar, making it the best-performing currency in Asia that day. Analysts from organizations like Bloomberg believe Samsung’s stock could increase another 22 to 30 percent in the next year. Currently, the stock is valued at about 6 times its future earnings, which is lower compared to 14 times in October.
Large companies like Apple are also showing interest in Samsung. Reports say there are early discussions for Samsung to produce main processors for Apple devices in the United States, which would act as an alternative to its long-time partner TSMC.
Investment experts say this milestone is not just symbolic but shows strong market confidence in the importance of memory chips in AI systems. Firms such as Roundhill Investments and Jupiter Asset Management believe there is still significant growth potential, even for investors entering later, as limited supply continues to support profits.
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However, there are some challenges. While the chip business is doing very well, Samsung’s mobile phone and display divisions are facing difficulties due to higher material costs, which has reduced profits in those areas. At the same time, workers are demanding a larger share of the profits from the AI boom and have threatened an 18-day strike later this month.
Even with these issues, the overall outlook remains positive. Samsung and SK Hynix together account for more than 43 percent of the Kospi index, making South Korea one of the most active markets globally. Technology earnings continue to grow strongly, driven by the AI boom, which is changing the old cycle of ups and downs in the memory chip industry.