FILE PHOTO: A Samsung Galaxy Z Flip 7 phone are displayed during an event in New York, U.S., July 8, 2025. REUTERS/Jeenah Moon/File Photo
FILE PHOTO: A Samsung Electronics logo and a computer motherboard appear in this illustration taken August 25, 2025. REUTERS/Dado Ruvic/Illustration/File Photo

SEOUL (Reuters) -Samsung Electronics reported its memory chip revenue hit a record high in the third quarter and said it will focus on mass producing its most advanced products next year, expecting continued strength in the chip market, driven by AI demand.

The turnaround of the world's top memory chipmaker reflects the unexpected boom in conventional chip prices, with supply squeezed by the industry's shift to producing advanced AI chips, while demand is rising for data centres.

At the same time, Samsung said on Thursday its current-generation HBM3E chips are being sold to "all related customers," suggesting it has joined rivals like SK Hynix in supplying the latest 12-layer HBM3E chips to artificial intelligence chip leader Nvidia.

Samsung shares rose as much as 5.3% after the results, sharply outpacing a 0.9% gain in the benchmark KOSPI.

Samsung's chip business, its main cash cow, posted an operating profit of 7 trillion won ($4.92 billion) in the third quarter, up 80% from a year earlier. Its memory chip business reported record revenue of 26.7 trillion won, up from 22.3 trillion won a year ago.

"The semiconductor market is expected to remain strong, driven by ongoing AI investment momentum," Samsung said in a statement.

"Looking ahead to Q4, the rapid growth of the AI industry is expected to open up new market opportunities," it said.

Its bullish comment echoes the robust outlook offered by SK Hynix, which on Wednesday said it expected an extended chip "super cycle" spurred by the AI boom, as it had already sold out all its chip production for next year.

Tech giants including OpenAI have in recent months announced multi-billion dollar plans to invest in AI infrastructure despite uncertainty about returns, sparking investor questions as to whether the AI boom may be the next big bubble.

Samsung has been slow to capitalise on soaring demand for AI chips that benefited its rivals like SK Hynix, a key memory chip supplier to Nvidia, but the recent boom in commodity chip sales has been a boon to the South Korean tech giant that also makes smartphones, TVs, home appliances and flat screens.

Investors are looking for signs that Samsung is narrowing the gap with SK Hynix with the next-generation HBM4 chips.

Samsung said its HBM4 samples are being shipped to key clients, and it will focus on the mass production of HBM4 products next year, betting on rising demand.

Samsung posted 12.2 trillion won in operating profit for the July to September period, in line with its estimate of 12.1 trillion won.

($1 = 1,421.4800 won)

(Reporting by Hyunjoo Jin, Heekyong Yang and Joyce Lee; Editing by Sonali Paul)