Samsung Electronics is set to be the first South Korean firm to exceed 200 trillion won ($146.6 billion) in cash assets, supported by an increase in demand for artificial intelligence (AI) chips and a worldwide semiconductor upcycle, industry data revealed on Sunday.
According to reports, its cash reserves have almost doubled from the 108.5 trillion won noted at the end of the September quarter last year.
By the end of September, Samsung's total assets increased to 791.8 trillion won, reflecting a growth of 32.4 trillion won from the previous quarter.
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Market analysts predict that the firm's increasing cash reserves may offer enough capital to fulfill its intended shareholder distributions for 2026. In August, Samsung announced that it would allocate between 90 trillion won and 110 trillion won for shareholder returns next year according to its capital return policy.
Simultaneously, the firm is getting ready to increase its investments in semiconductor production and research. This year, investments in chip-making infrastructure and research and development are anticipated to surpass 100 trillion won, marking a record for the firm. Out of this, 84.4 trillion won is designated for increasing memory manufacturing capacity.
Samsung anticipates that the semiconductor upcycle will continue into next year, driven by ongoing investment in AI and limited availability of memory chips. The organization is set to announce its policy for shareholder returns for the next year during a board meeting in January.
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The cash buildup arises as the company's profits increase due to a rising demand for semiconductors related to AI.
Samsung's net profit for the July-September quarter increased over six times compared to last year, reaching 75.13 trillion won ($56.2 billion), up from 12.22 trillion won in the same period of the previous year.
Furthermore, The Samsung Electronics Seocheon Training Center in Giheung-gu, Yongin, Gyeonggi Province, held the 'HMG Appreciation Day (Hyundai Motor Group Appreciation Day),' with 177 attendees, comprising key executives and their spouses from both Samsung and Hyundai Motor Group. This event was said to have been started by Samsung. Industry analysts view this as Samsung showcasing Chairman Lee Jae-yong’s accomplishments in the automobile industry, signaling a change from its historical resistance to collaborate closely with other large companies.
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The evolving environment illustrates current patterns. Contemporary automobiles are fundamentally “smartphones on wheels,” incorporating AI-driven voice recognition, advanced semiconductors, batteries, and screens—fields where partnership with Hyundai Motor Group, a leading global automaker and compatriot company, has become crucial.
Additionally, Samsung and Hyundai Motor Group share very few overlapping sectors. Companies such as LG and SK aggressively vie in the fields of batteries, appliances, and semiconductors, resulting in significant conflicts among their employees. Conversely, these types of conflicts seldom occur between Samsung and Hyundai.
Industry insiders remember tense interactions between the executives of the two groups for years. A crucial point was the intense rivalry in 2014 for the Korea Electric Power Corporation site, which Hyundai secured for 10.55 trillion won. At that moment, Samsung condemned Hyundai for "misinterpreting strategies and excessive bidding," provoking criticism.