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The announcement pushed Samsung shares up more than 2% during early trading hours in Seoul. The company also reported a more than tenfold increase in its profits for the first three months of this year. For this quarter, Samsung expects its profit to rise to 10.4 trillion won ($7.54 billion; £5.9 billion), up from 670 billion won last year. This surpasses analysts’ forecasts of 8.8 trillion won, according to LSEG SmartEstimate.
“Right now, we are seeing skyrocketing demand for AI chips in data centers and smartphones,” said Marc Einstein, chief analyst at the Tokyo-based research and advisory firm ITR Corporation. Optimism about AI is one reason for the broader market rally over the past year, which pushed the S&P 500 and the Nasdaq in the United States to new records on Wednesday.
The market value of chip-making giant Nvidia surged past $3 trillion last month, briefly holding the top spot as the world’s most valuable company. “The AI boom that massively boosted Nvidia is also boosting Samsung’s earnings and indeed those of the entire sector,” Mr. Einstein added.
Samsung Electronics is the flagship unit of the South Korean conglomerate Samsung Group. Next week, the tech company faces a possible three-day strike, expected to start on Monday. A union of workers is demanding a more transparent system for bonuses and time off.
Source: BBC
