# Samsung Faces Market Skepticism Despite AI-Driven Chip Profit Surge Investors react to conservative supply outlook and delayed shareholder return announcements. - **Source:** [Technology | The Indian Express](https://indianexpress.com) - **Published:** 2026-10-29 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/9c700c6f-e8fd-45c0-8e7d-3917a97515c0 ## Quarterly Profit Performance Samsung Electronics reported a 15-fold increase in quarterly chip profit, reaching 107.4 trillion won for the July-to-September period. Despite this massive growth compared to the 12.2 trillion won recorded a year earlier, the semiconductor operating profit of 106.5 trillion won fell slightly short of analyst estimates provided by LSEG. ## Investor Sentiment Shift Samsung shares fell by as much as 6.2% following the earnings release. Investors reacted negatively to the company's lack of new shareholder return plans and a more conservative outlook compared to rival SK Hynix. While SK Hynix announced a 75 billion dollar return plan, Samsung deferred its policy decision until January. ## Supply Shortage Projections Samsung anticipates the chip market will remain tight through 2028, citing the time required to construct new fabrication plants. This outlook is more conservative than SK Hynix, which reported that its DRAM and HBM chips are sold out through 2029, with shortages expected to persist until 2030 across the broader industry. ## Capital Expenditure Strategy Samsung plans to increase capital spending for its chip division next year, following a 62% surge to 76.8 trillion won in 2024. The company expects AI infrastructure capital expenditure to reach historic levels by 2027, as the expanding AI ecosystem continues to drive demand that significantly exceeds current industry supply capacities. ## Long-Term Contract Focus To stabilize production, Samsung has signed long-term supply contracts with 10 major customers and is negotiating with 10 more. The company aims for these agreements to represent 60% to 70% of total production capacity by 2030, expanding beyond AI hyperscalers to include mobile and automotive sectors to mitigate market volatility. ## Foundry Business Challenges The foundry business remains at a loss, impacting overall chip division earnings. However, Samsung reported revenue improvements driven by HBM logic die sales and new orders for advanced 2-nanometer chips. The company will begin mass production at its Texas plant next year, specifically targeting chip manufacturing for Tesla and other AI-focused clients. ## Mobile Margin Pressure Rising memory-chip costs have negatively impacted Samsung's mobile business, which recorded a loss of 800 billion won. While AI chip demand remains resilient, concerns regarding AI infrastructure financing and increasing competition from Chinese manufacturers continue to weigh on the broader chip sector, affecting stock valuations and investor confidence in the near term. ## Strategic Market Outlook Samsung remains in a precarious position as it balances massive capital investments with shareholder expectations. By delaying its return policy until January, the company faces immediate market pressure. Success will depend on its ability to scale 2-nanometer production and maintain long-term contracts while navigating the slowing pace of memory-chip price gains. ## Sources covering this story - https://indianexpress.com/article/technology/tech-news-technology/samsung-sees-ai-chip-shortage-worsening-keeps-investors-in-suspense-on-returns-10941798/ — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._