AI drives semiconductor demand, Samsung jumps 12% as its market cap surpasses $1 trillion

Benefiting from strong demand for advanced memory chips driven by AI infrastructure, Samsung Electronics’ market value has officially surpassed the $1 trillion mark. The company’s share price has risen nearly fourfold over the past year, and during today’s (5/6) early session it was up as much as 12%, becoming the second Asian company—after TSMC—to reach this milestone. The rally also lifted the Korean Kospi index past the 7,200-point threshold, underscoring the core role of Asia’s tech giants in the global AI supply chain.

Semiconductor profits surge and memory market supply-demand

Samsung’s semiconductor division posted profits for the March quarter that exceeded market expectations, delivering a notable 48x growth. This was largely attributed to high gross margin performance driven by orders from AI data centers. Market analysts say the memory market is currently in a supply-demand tightness, and they expect the contract prices for NAND Flash and DRAM to continue rising. Investment firms believe that the supply-demand situation in 2027 may be tighter than in 2026, suggesting that memory’s role in AI infrastructure has shifted to structural demand rather than merely cyclical fluctuations.

(Samsung profit up 755%! DRAM quote seen rising another 100%, 32 GB memory could jump past $400)

Supply chain expansion and potential Apple cooperation

In addition to its advantages in the memory market, Samsung has seen new developments in the foundry business. Reports say Apple (Apple) is holding preliminary discussions to evaluate whether Samsung would produce the main processors for its devices in U.S. factories. If this partnership comes to fruition, it would give Apple a second supplier option beyond long-term partner TSMC. This potential cooperation would not only help Samsung expand its foundry business footprint, but also reflects the strategic planning by global tech giants around diversifying supply chains and dispersing risk—further strengthening Asia-based firms’ key position in core computing capabilities.

(Apple seeks Intel and Samsung foundry chips, TSMC’s near-exclusive position faces challenges)

Samsung’s valuation snapshot and business operating challenges ahead

Despite strong performance from its semiconductor business, Samsung still faces operational challenges both internally and externally. Its mobile communications and display segments are under pressure from rising materials and component costs, and profitability has been relatively weaker. In addition, the sharp surge in earnings has sparked disputes over labor distribution, with employees planning to launch an 18-day strike action this month. However, from a market valuation perspective, Samsung’s current forward P/E (Forward P/E) is only 5.3x, far below the 14.4x seen in October last year. According to Bloomberg’s data, analysts’ forecasts suggest the company’s stock still has about 30% potential growth over the next 12 months.

This article first appeared on ChainNews ABMedia: AI boosting semiconductor demand, Samsung shares jump 12% with market cap breaking $1 trillion.