Stock Prices Fall Despite Record Profits... What Lies Ahead for the Semiconductor Market?

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Samsung Electronics posted an operating profit exceeding 107 trillion won in the third quarter, recording the largest corporate earnings in global history outside of Saudi Arabia's state-owned oil giant Aramco. Despite this, its stock price dropped considerably yesterday (October 8), and analysts suggest that the rising cost of borrowing money, or market interest rates, is becoming a particularly severe burden for semiconductor companies.

Reporter Kim Beom-joo has the details.

[Reporter]

Samsung Electronics shares closed the regular trading session down 2.42% at 262,000 won.

SK Hynix also fell 2.44%, largely driven by simultaneous selling by foreign and institutional investors.

The outlook that both companies' earnings will remain at a high level for at least the next three years or more remains unchanged.

[Sanjay Mehrotra / Micron CEO (October 1): We expect memory semiconductor demand to be even stronger in 2027 and 2028. We see no signs that customer demand might decline.]

Nevertheless, the drop in stock prices is interpreted, in the short term, as investors concluding that the semiconductor boom has already been largely priced into the stocks and engaging in so-called rotation, moving toward sectors with higher potential for near-term gains.

Looking further ahead into the mid-to-long term, U.S. interest rates are also to blame.

As U.S. Treasury yields surge day by day, increasing the borrowing costs for corporations, growing concerns are emerging over when this might negatively impact the artificial intelligence investment boom.

Apprehensions also persist that the U.S. government, leveraging tariffs on the back of these record earnings, will ramp up pressure to invest more in the U.S. as the midterm elections approach.

[Donald Trump / U.S. President (September 26): We need tariffs. Even if we win big in the elections, ultimately you have to have tariffs to compel foreign investment.]

Add to this the pursuit by Chinese companies, which are steadily chasing behind South Korean firms starting from the low-performance DRAM sector, and how to fend off the bills and threats flying in behind record-high earnings has been left as a homework assignment for local businesses and the government alike.

(Reported by Choi Ho-jun | Video by Jung Yong-hwa | Graphics by Kim Yeji)
※ Please note: This article was translated by AI and may contain errors.