Samsung stock plunged over 8% on Tuesday even after the company flagged what could be its most profitable quarter ever.
The shares fell as much as 7.9%, despite Samsung guiding for second-quarter operating profit of 89.4 trillion won, a 19-fold jump from a year earlier.
The reaction was not about weak numbers but about whether the market had already priced in the good news and whether AI-driven memory demand can keep growing at this pace.
AI boom is rewriting Samsung’s balance sheet
The headline number is huge, but the mechanism is straightforward, as big technology companies are spending heavily on AI data centres.
That is lifting demand for high-bandwidth memory, or HBM, while also tightening the supply of conventional DRAM and NAND chips used in servers, phones and PCs.
That tightness has pushed prices higher.
Samsung’s own first-quarter results had already pointed to the same trend.
Its Device Solutions division posted 81.7 trillion won in revenue and 53.7 trillion won in operating profit in Q1, with the memory business helped by “high-value-added AI demand” and limited industry supply.
The second quarter also matters because Samsung has begun commercial shipments of HBM4, making this the first period in which the newest AI memory product can start contributing to revenue.
Korea Investment & Securities noted that investors will be watching how HBM4 shipments and pricing affect the July 30 divisional breakdown.
Why Samsung stock is falling despite record profit expectations
Samsung’s guidance was spectacular on paper, but investors were not caught off guard.
Analysts had already been raising forecasts aggressively into the announcement as DRAM and NAND prices surged and demand from AI data centres tightened supply.
The Financial Times reported that DRAM and NAND contract prices jumped 44% and 53% quarter-on-quarter, helping Samsung post its third straight quarter of record operating profit.
That created a classic “sell the news” setup.
When a stock has already rallied on expectations of a blowout quarter, even record profit may not be enough unless the company beats the most bullish whisper numbers.
As per analysts, the investors also remain worried about whether the AI infrastructure boom can continue without delays, funding pressure or signs of oversupply.
There are company-specific doubts too as Samsung’s memory division is carrying the business, but investors still want proof that the foundry unit, mobile division and consumer electronics business are not being squeezed by the same component-cost cycle that is lifting chip profits.
The full July 30 results will matter because they will show whether this record quarter is broad-based or mainly a memory-cycle windfall.
Analysts are bullish, but with caveats
The bullish case is that the memory cycle still has legs. Meritz Securities analyst Kim Sun-woo said memory chip selling prices should keep rising through the end of the year.
He also said Samsung’s record-breaking performance trend could continue through 2026, with memory supply likely to remain short of demand growth until at least late 2029.
But the share-price reaction shows the bar is now very high.
Kiwoom Securities analyst Han Ji-young warned that a historic quarter may not be enough if investors were already expecting it.
According to Finance BigGo, Han said the market’s real expectations may have been above the 85 trillion won level, leaving room for selling pressure if the earnings surprise was not great enough.
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