AI turned memory chips into one of the planet's most profitable products

Artificial Intelligence and the Memory Market: How Giant Companies Are Changing the Rules of the Game

The second half of last year led to a surge in AI investments, making the memory semiconductor industry ultra‑profitable. Analysts predict that Samsung will surpass Apple, Microsoft, and Alphabet in revenue, while SK hynix and Micron will enter the world’s top ten most profitable companies this year.

Company | Share Price Increase Since Early 2024
Samsung | +72 %
SK hynix | +90 %
Micron | +65 %

Why Memory Became a “Gold Mine”

1. Demand for HBM—high‑bandwidth, specialized memory required for AI—has displaced traditional DRAM modules used in smartphones and PCs.

2. Inference AI requires massive amounts of standard DRAM, leading to shortages and price hikes.

Trendforce reported that memory prices in the first three months of 2026 rose not by the expected 50 % but by a full 100 %.

Financial Results

- Samsung Electronics announced net profit exceeding $30 billion in Q1 2026, surpassing its previous quarterly record and nearly reaching an annual high.

- About 94 % of that profit came from its semiconductor business.

- SK hynix and Micron delivered similarly impressive results, confirming the dominance of the three giants in the memory market.

FactSet estimates the combined net profit of Samsung, SK hynix, and Micron in 2026 at roughly $350 billion. Forecasts suggest each will enter the world’s top ten most profitable companies—a scenario no one anticipated a year ago.

Operating Efficiency

- DRAM: operating margin 80 %.

- Flash memory: margin 60 % (Counterpoint data).

New Supply and Investment Models

Previously, customers relied on verbal agreements. Now many firms are moving to mandatory contracts lasting up to five years, which include:

- Advance payment of about 30 % of the cost;

- Participation in investments for new fabs.

“Those who dominate memory can also dominate AI,” notes a Counterpoint representative.

Manufacturing Investments

Building one semiconductor fab can cost over $20 billion and take years. Samsung, SK hynix, and Micron are already working on new facilities, but analysts believe the full capacity of these plants will not be reached until the end of 2027–2028. Therefore, improvements in the near term are unlikely.

Deficit Outlook

According to preliminary orders from Samsung, the gap between supply and demand in 2027 could become even more pronounced than in 2026, said Kim Cheojun, head of the memory semiconductor manufacturing division.

Conclusion:

Demand for memory driven by AI growth has turned DRAM and flash memory producers into some of the world’s most profitable companies. Despite high capital expenditures and long construction timelines for new fabs, expectations of continued shortages and price increases remain strong.