Samsung hit a $1 trillion market valuation on Wednesday, with its stock price jumping more than 10%. The surge was fueled by the ongoing artificial intelligence boom, which continues to drive massive demand for chips. This milestone makes Samsung only the second Asian company ever to reach the trillion-dollar mark, following TSMC.

The news comes right after Samsung reported a blockbuster earnings report last week, showing profits eight times higher than the same period last year. Every company building AI systems right now needs chips, and Samsung produces the memory chips that power those systems. Demand is soaring while supply struggles to keep pace, pushing prices upward and boosting Samsung’s bottom line.

There’s another reason shares surged on Wednesday. Reports emerged yesterday that Apple has been in talks with both Samsung and Intel to manufacture chips for Apple devices on U.S. soil. Apple has long relied almost exclusively on TSMC in Taiwan for chip production. If Samsung lands this deal, it would mark a major shift in the global semiconductor supply chain.

At the heart of Samsung’s profit explosion is high-bandwidth memory (HBM), a type of chip critical for running AI systems. This product has dramatically improved the company’s margins. But competition is fierce. Rival SK Hynix, another South Korean semiconductor giant, is aggressively chasing the same market, keeping pressure on Samsung to maintain its edge.

The AI boom is creating a chip shortage across the semiconductor industry. The world’s three largest memory chip makers—Samsung, SK Hynix, and Micron—are all struggling to keep up with runaway demand from AI data centers. All three companies have shifted investment away from consumer chip production to ramp up HBM output, which offers much higher margins and has become essential for large-scale AI infrastructure.

Despite Wednesday’s historic surge, Samsung still faces challenges. Workers are threatening an 18-day strike later this month, demanding a larger share of the AI windfall. Meanwhile, Samsung’s phone and TV divisions, which also need to buy those same memory chips for their products, are paying steep prices for the very chips driving the company’s record profits.