Nomura: Samsung Electronics 1Q26 Significant Beat; Memory Super-Cycle Continues
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Nomura maintains a Buy rating on Samsung Electronics (005930 KS) with a target price of KRW 320,000, following preliminary first-quarter 2026 results that significantly exceeded expectations. The company reported revenue of KRW 133 trillion, up 68% year-over-year, and operating profit of KRW 57 trillion, up 756% year-over-year. These figures surpassed Nomura's estimate of KRW 47 trillion and the Bloomberg consensus of KRW 39 trillion.
The semiconductor division's estimated operating profit reached KRW 54 trillion. Nomura notes that both DRAM and NAND prices surged over 100% quarter-over-quarter, exceeding earlier projections of 90% and 65% growth. A weaker Korean won further bolstered profitability. In contrast, mobile and home appliance segment profits declined due to rising memory costs and intensifying competition.
The memory super-cycle is expected to persist, with supply shortages lasting at least through 2027. Long-term agreements should mitigate oversupply risks and enhance earnings sustainability. For the second quarter of 2026, memory price growth could exceed the current market consensus of a 30% to 50% sequential increase. Nomura projects that second-quarter and full-year 2026 operating profits will surpass previous March estimates of KRW 81 trillion and KRW 321 trillion, respectively. The firm expects a robust total shareholder return exceeding 9% in 2026 and 13% in 2027.