Samsung shares slide despite record nine-fold profit jump as payout details slip to January
Key Takeaways
- •Samsung's third-quarter operating profit jumped 783.1% year-over-year to 107.44 trillion won, making it the first technology company to exceed 100 trillion won in quarterly operating profit.
- •The stock fell as much as 6.2% in morning trade as the board postponed decisions on 55–75 trillion won in remaining shareholder returns until late January 2027.
- •Samsung forecast the memory shortage will persist through 2028, two years shorter than SK Hynix's view that demand will outstrip supply through 2030.
- •Next year's HBM supply is already sold out at target prices, and HBM4 now accounts for roughly 60% of HBM sales after its revenue more than tripled sequentially.
- •The Device eXperience division recorded an 800 billion won operating loss on 52.1 trillion won in sales, weighed down by higher memory prices.
Samsung Electronics shares dropped 4.13% to 232,000 won on Thursday, even as the company reported record third-quarter results, with operating profit surging almost nine-fold to 107.44 trillion won. Analysts attributed the pullback to a shareholder payout plan delayed until January and a memory shortage forecast that runs two years shorter than rival SK Hynix's outlook.
The stock climbed early in the session, then reversed to fall as much as 6.2% in morning trade. SK Hynix gained 0.7% in morning trade.
Record quarter powered by chips
Operating profit for July–September reached 107.44 trillion won, up 783.1% from 12.2 trillion won a year earlier, according to Samsung's official results announcement. Revenue hit a record 195.25 trillion won, up 126.9%. Samsung said it is the first technology company in the world to exceed 100 trillion won in quarterly operating profit.
The Device Solutions chip division accounted for 106.5 trillion won of that operating profit on 147.1 trillion won in revenue. That came in slightly below the 107.3 trillion won analysts had expected from the chip division, according to LSEG.
Up to 75 trillion won in returns awaits January board meeting
The board sanctioned a third-quarter dividend of 4,601 won per common and preferred share, more than 12 times the roughly 370 won paid in each of the first two quarters. The total payout, due Nov. 27, amounts to 30 trillion won, or about $22.5 billion.
Samsung expects shareholder returns of 90–110 trillion won for 2026. With 35 trillion won planned or completed, between 55 trillion and 75 trillion won remains to be allocated. The remainder is expected to include a considerable share repurchase and cancellation program along with cash dividends. The board will convene in late January 2027 to decide the final amounts and implementation plans. Until that meeting, the size and composition of the remaining 55 trillion to 75 trillion won stay undecided.
The company said it is in detailed discussions on a new shareholder return policy for 2027 onward, designed to deliver sustainable expansion and improved shareholder value. The 110 trillion won ceiling, set in August, is based on a policy to return 50% of free cash flow generated from 2024 to 2026.
Samsung also said it would consider repurchasing additional preferred shares, citing the price gap with common stock. In January, it announced a 2.5 trillion won buyback to fund payments to employees and executives.
Memory stays tight through 2028, two years short of SK Hynix's call
SK Hynix set a high bar on Wednesday. Cryptopolitan reported that SK Hynix's HBM and DRAM sales are sold out until 2029, and the company expects demand to outstrip supply for memory products through 2030.
Samsung, by contrast, said the market will remain tight through 2028, given the time required to construct new fabrication plants. The company added that, as of 2027, AI demand will far exceed industry supply, even more so than in 2026. The two-year gap leaves the companies without a shared timeline for how long the shortage runs.
Samsung said supply of HBM (high-bandwidth memory) for next year is already sold out at target prices, with major customers still asking for more. HBM4 revenue more than tripled sequentially and now constitutes about 60% of HBM sales. The company has locked in long-term supply contracts with 10 major customers, with 10 more under negotiation, and aims for such deals to account for 60% to 70% of capacity by 2030.
Elsewhere in the business, the Device eXperience (DX) division recorded an operating loss of 800 billion won on sales of 52.1 trillion won, weighed down by higher memory prices — the cost side of the same shortage powering the chip unit's records. Mobile and networks lost 600 billion won.
Capital investment for the chip division this year has been set at 76.8 trillion won, out of 84.4 trillion won for the entire company. In the third quarter alone, capital expenditures hit 29 trillion won. That investment is the pipeline for new fabrication capacity, whose long build times Samsung said will keep the market tight through 2028.
