After logging losses for five consecutive quarters, Samsung Electronics' chip business returned to the black in the first quarter this year, thanks to rising demand for high-end chips and a surge in chip prices.

In its earnings report for the January-March period on Tuesday, Samsung said its chip division reported 23.1 trillion won ($16.7 billion) in sales and 1.91 trillion won in operating profits.

The profit comes after the company suffered operating losses for five consecutive quarters. In 2023 alone, it reported a deficit of 14.9 trillion won.

Backed by strong sales of its flagship Galaxy S24 smartphones, and the recovery in the chip business, Samsung Electronics reported its total revenue at 71.9 trillion won, up 12.8 percent on-year. The operating profit jumped by 931.8 percent on-year to log 6.6 trillion won.

The weakness of the Korean won against major currencies positively influenced the company’s wide operating profit of about 300 billion won when compared to the previous quarter, the company added.

According to Samsung, both its DRAM and NAND chip shipments decreased by mid-10 percent and by single-digit figures, respectively. But the average selling price of the products increased, by 20 percent for DRAM chips and 30 percent for NAND chips.

The world's top memory chip maker predicted earnings in the memory chip business will continue to improve for the rest of the year.

"For this year, we will be increasing the supply bit to about three times more than that of last year. In 2025, the company forecast the supply bit growth will be double that of this year," Samsung Electronics Executive Vice President Kim Jae-joon overseeing the memory division said during the earnings call for Q1.

Samsung said it started mass production of 8-stack HBM3E this month and plans to mass produce the bigger 12-stack HBM3E products, and a 128GB product based on 1b nanometer 32Gb DDR5 within the second quarter this year.

The chip giant also started mass production of V9 NAND for the first time in the industry this month, the company added.

With geopolitical factors creating uncertainties, the foundry market is expected to see limited growth in the second half of this year. But Samsung said its foundry business is expected to outpace the market growth rate in annual sales thanks to increased sales of its cutting-edge 5nm and below technologies.

Samsung said it will start the mass production of Gate-All-Around 3nm second-generation technology and improve the maturity of 2nm technology for AI and high-performance computing applications.

The chip giant forecasts its second-quarter revenue to rebound and achieve double-digit on-quarter growth.

Samsung, which is currently building chip manufacturing facilities in Taylor, Texas, said it expects to start the mass production of chips at the facility in 2026.

The company’s smartphone business logged 33.5 trillion won in consolidated revenue, and 3.51 trillion won in operating profit, largely driven by its first on-device AI smartphone Galaxy S24 which lured younger users in their 20s.

"About half of the Galaxy S24 series users said they purchased the phone for the AI features, and the MZ generation users were the main users of the new technology," Samsung Electronics Executive Vice President Daniel Araujo said during the earnings call.

In the second half of this year, the company will be introducing its new foldable smartphone lineup featuring its latest on-device AI technology, and also its first wearable device Galaxy Ring.

Samsung Display, the display maker affiliated with Samsung Electronics, achieved sales of 5.39 trillion won and an operating profit of 340 billion won, with the QD-OLED monitors contributing to profit.