Samsung had a strong quarter thanks to increased smartphone and chip sales.

Samsung's third-quarter report, released Wednesday, marks a substantial recovery from the second quarter, which was negatively affected by the poor performance of its chip business. The company's Q3 operating profit increased by 160% compared to Q2, while revenue saw a 15.5% increase quarter-over-quarter. The turnaround was largely due to a 19% increase in chip sales during the three months.

The company anticipates robust semiconductor sales in early 2025, driven by a strong semiconductor market. A company press release stated, "In the first half of 2026, we expect the semiconductor market to remain strong, driven by ongoing AI investment momentum."

The chip business generated an operating profit of 7.0 trillion won ($4.91 billion) in the third quarter, which is up 81% from the prior year. It also reflects a more than tenfold increase sequentially. Division sales totaled 33.1 trillion won ($23 billion), a 13% increase year-over-year. The Device Solutions division includes memory chips, semiconductor design, and Samsung Foundry.

The results signal positive momentum for Samsung's Device Solutions business. Increased HBM market share, driven by Nvidia's volumes, is expected to benefit Samsung. Additionally, a recent report indicated Samsung regained its position as the leading supplier of memory chips like DRAM and NAND in Q3, after falling to second place behind SK Hynix in the previous quarter.

The mobile experience and network businesses, responsible for smartphones, tablets, and wearables, saw a 28% increase in operating profit to 3.6 trillion won ($2.53 billion). Samsung attributed this to strong sales of flagship smartphones, including the Galaxy Z Fold 7.

Looking ahead, Samsung informed analysts that AI industry growth would lead to opportunities for its chips and devices. Overall, the quarter was encouraging, especially compared to the previous quarter.

Samsung expects AI to drive continued earnings growth. A company spokesman stated, "We expect data center companies to continuously expand their hardware investment because of the ongoing competition to secure AI infrastructure. Therefore, our AI-related server demand keeps growing, and this demand significantly exceeds industry supply."

In Korea on Thursday, Samsung's shares increased by 3,000 won ($2.11), or 3%, to 103,500 KRW ($72.92). This is closer to the 52-week high of 105,800 KRW ($74.33) than the 52-week low of 49,900 ($35.06).