Brokerage : SK Securities
Analyst : Dong-hee Han
Investment Rating : Not Provided
Target Price : Not Provided
Core Momentum : Preliminary 4Q25 operating profit reached KRW 20.0T (+64% QoQ) driven by memory price surges; structural AI scale-out and industry supply constraints combined with earnings stability from Long-Term Agreements (LTAs) reinforce expectations for memory valuation expansion.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Not Provided in text
- 4Q25 Preliminary Results:
- Revenue: KRW 93.0T (+8% QoQ, +23% YoY, in line with 1M consensus of KRW 92.9T)
- Operating Profit: KRW 20.0T (+64% QoQ, +208% YoY, beating 1M consensus of KRW 19.8T by 1%)
- Operating Profit by Division (4Q25P):
- DS (Semiconductor): KRW 16.6T (+136% QoQ, +472% YoY)
- Memory: KRW 17.7T (DRAM KRW 15.5T, NAND KRW 2.2T)
- Foundry/LSI: Operating loss of KRW 1.1T (loss continues)
- DX: KRW 1.0T (-71% QoQ, -57% YoY)
- MX/NW: KRW 1.8T (-50% QoQ, -14% YoY)
- VD/CE: Operating loss of KRW 0.8T (turned to loss)
- SDC (Display): KRW 2.0T (+66% QoQ, +122% YoY, OPM 21%)
- Harman: KRW 0.4T (flat QoQ, +3% YoY)
- DS (Semiconductor): KRW 16.6T (+136% QoQ, +472% YoY)
🚀 2. [Market Opportunities & Business Outlook]
- 4Q25 Memory Performance Metrics:
- DRAM: Bit growth -1% QoQ, ASP +36% QoQ, estimated OPM 57%
- NAND: Bit growth -9% QoQ, ASP +21% QoQ, estimated OPM 18%
- ASP growth significantly exceeded expectations, generating KRW 17.7T in Memory operating profit to lead consolidated performance
- Segment Details:
- Non-Memory (Foundry/LSI): Operating deficit widened to KRW 1.1T due to mobile front-end procurement adjustments and cost burdens amid memory strength
- SDC: Delivered solid operating profit of KRW 2.0T (OPM 21%) on favorable FX and robust North American client shipments
- MX/NW: Profitability missed forecasts (KRW 1.8T) due to higher memory BOM costs and a lower mix of flagship foldables QoQ
- Industry Outlook & Structural Catalysts:
- Qualitative & Quantitative Growth: AI scale-out establishes memory as the primary core for enhancing AI computing power
- Supply-Demand Deficit & LTA Expansion: Industry supply constraints persist against strong demand spanning HBM, server DRAM, LPDDR, SOCAMM2, and SSDs; binding LTAs will enhance earnings stability and justify valuation expansion
- Signals the beginning of a recovery from Samsung’s relative earnings underperformance within the memory industry
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as an enterprise achieving preliminary 4Q25 operating profit of KRW 20.0T (+64% QoQ)—led by the DS division (Memory operating profit of KRW 17.7T) on steep DRAM (+36% QoQ) and NAND (+21% QoQ) pricing gains—which fully absorbs non-memory deficits and margin compression in mobile (MX) caused by higher BOM costs. This perspective places primary emphasis on memory entering a simultaneous qualitative and quantitative growth phase driven by AI scale-out, the beginning of a recovery from Samsung’s relative earnings underperformance within the memory industry, and multiple expansion supported by binding LTAs, rather than near-term hardware softness.
To verify whether this investment thesis continues to materialize, key verification points include whether DRAM and NAND ASP strength persists amid supply deficits, whether long-term supply agreements expand and improve earnings stability, whether relative earnings performance within the memory industry continues to recover, and whether non-memory losses begin to narrow alongside margin stabilization in downstream consumer hardware. These developments can be monitored through upcoming quarterly earnings releases, official IR presentations, regulatory filings, and periodic financial reports.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
Contact: Compliance and Copyright Inquiries (ksb220805@gmail.com)
