Samsung Electronics has risen to become the most profitable company in the world. On Monday, Samsung Electronics disclosed that its preliminary revenue for the second quarter of this year reached 171 trillion won, with operating profit of 89.4 trillion won. Revenue and operating profit surged 129% and 1,810%, respectively, from a year earlier. Considering that performance-bonus provisions in the first half of this year amounted to as much as 17 trillion won, actual operating profit reached 106 trillion won. Surpassing even Nvidia ($53.5 billion, or 81.8555 trillion won), the world's top company by market capitalization, Samsung also recorded the highest earnings ever for a global big-tech company.
While Samsung Electronics made history by rising to become the "world's top profit-earning company," this is no time to fire off celebratory cannons. On the same day, Samsung Electronics shares closed down 6.9% at 296,000 won despite the record-breaking earnings. This is interpreted as reflecting doubts about further profit growth, labor-management conflict over performance bonuses, and the massive investment costs that lie ahead. It is unclear how long earnings like these can continue, results that reflected the memory chip boom driven by expanded artificial intelligence (AI) investment among hyperscalers operating large-scale data centers.
In the semiconductor industry, the winners and losers of the next cycle are determined by how boldly a company invests during boom times. If astronomical profits are concentrated solely on expanding performance bonuses or shareholder returns, future competitiveness could be undermined. This is why Samsung Electronics has drawn up a long-term investment plan totaling 2,050 trillion won, including 1,650 trillion won for its semiconductor clusters in Yongin and Pyeongtaek and 400 trillion won for its Gwangju semiconductor project. Through these investments, Samsung Electronics should be able to expand its production capacity for high-bandwidth memory (HBM), a core element of the AI era, and broaden its investment portfolio to include next-generation memory and advanced packaging, thereby securing an insurmountable competitive edge.
To do so, all-out support at the national level is essential. The global competition for semiconductor supremacy has become a total war between nations, going beyond individual companies. The United States and China are growing their domestic semiconductor industries with enormous subsidies, while Japan is accelerating its efforts to secure production bases on the back of large-scale investments by TSMC, Micron and others. For Korea to strengthen the supremacy of K-semiconductors, steps such as flexibility in the 52-hour workweek system, timely supply of core infrastructure and securing top talent must quickly follow. Herein lies the clear reason why the government must move swiftly to provide legal and institutional support so that companies can focus on future investment and raise productivity.
