Samsung Electronics saw net profit rise sixfold in Q2, surging 46 percent — to $7.11 billion — compared to Q1. The buoyant results for the South Korean electronics manufacturer were driven by its semiconductor business and the demand for advanced chips needed to fuel the global boom in artificial intelligence. Although the company is the world’s top smartphone manufacturer, more than half of the quarter’s operating profit came from chip-making for the latest reporting period. Revenue for the April through June quarter resulted in a 23.42 percent increase year-over-year, while profit soared 1,458 percent.

The company says chip demand — especially for those used in servers and cloud computing data centers — will be strong throughout the second half of the year, when the company’s foundry business expects to see a rebound in mobile demand.

“The tech giant’s memory-chip business had swung to a profit in the first quarter of 2024 after four straight quarters of losses,” reports The Wall Street Journal.

“During its earnings call, the firm said it plans to address the AI demand by expanding sales of HBM3E — the latest AI memory product — through capacity expansion in the second half,” CNBC writes, noting that Samsung execs said “expanding capacity to meet demand for high-bandwidth memory (HBM) and server DRAM could further constrain supply of conventional memory chips.”

In Q2, the company invested billions of dollars in research and development to improve overall HBM production capability and is also expanding capacity to meet demand for SSDs used in AI servers. Prices for memory chips are expected to continue their uptrend, according to CNBC.

In the second half of 2024, the company expects overall demand for smartphones to increase, with premium products that support AI and the innovative features made possible by generative features driving that growth, according to the earnings report.

Samsung saw a 0.7 percent increase in Q2 smartphone shipments, reaching 53.9 million units for the period, “surpassing Apple’s 45.2 million units for the quarter, according to preliminary data from market research firm International Data Corp.” and allowing Samsung to retain the title of world’s largest smartphone manufacturer, per WSJ.

The company’s new Galaxy S24 series “achieved double-digit year-on-year growth in both shipments and revenue over its predecessor for both the second quarter and the first half of the year,” Samsung noted.