I’m not sure what would’ve counted as “good enough” from Samsung’s closely-watched quarterly report on Tuesday, but I do know what wasn’t good enough: Profit of 89.4 trillion won on sales of 171 trillion won.

The shares, which’ve more than doubled in 2026 and were up almost 600% at the June peak from the “Liberation Day” lows, have obviously priced in quite a bit of good news. Including, apparently, an 1,800% YoY profit increase.

Samsung dropped like a stone on the print, tripping yet another circuit breaker on the Kospi Tuesday. This is what happens when lost bearings collide with a leverage-fueled equity mania.

The figure above’s a reminder: The gains for chipmakers, and for HBM names specifically, over the past 12 months are nothing short of staggering.

The rub — and we’ve seen this with Nvidia — is that there’s a point beyond which it’s impossible to discern where the actual bar is for earnings. We know consensus, of course, but we also know that “merely” beating estimates and guiding for more isn’t likely to be sufficient for the stock to post additional gains.

For Samsung, it was a moot point. The profit beat was just 6% or so. Anyone could’ve told you that probably wouldn’t be enough. And any material downside in the stock was guaranteed to snowball because South Korea’s national chip champions are in thrall to leveraged single-stock ETFs, which on some days account for a huge share of underlying turnover.

There’s a simple visualization of the profit and sales results. As noted, Samsung grew the bottom line 1,800% versus the same period a year ago and revenue rose 130%.

So, the absurdist headline out of South Korea on Tuesday went something like this: Trading suspended as stocks plunge on 19-fold Samsung profit increase.

Just to put things in perspective (because the profit numbers are so huge as to make the chart almost useless as a visual aid), Samsung made more operating profit in Q2 than it did over the past three years combined. The company’s reward: A selloff that lopped some $75 billion from its market cap.

Again, it’s important to note that the price action’s hostage to the leveraged ETFs. And just to leverage in general. Margin debt’s more than doubled in South Korea over the past 12 or so months.

But from a fundamentals perspective, the worry is that US hyper-scalers will rein in capex as their own stocks struggle. On Monday, Morgan Stanley’s Mike Wilson made that case.

Samsung, together with SK Hynix and Micron, have a chokehold on HBM supply at a time when demand’s insatiable. As discussed here last week, Micron’s seen accounting for nearly a fifth of total S&P 500 EPS growth this year and next.

But the surge in memory chip prices is beginning to hit consumers, and price increases aren’t confined to HBM. The cure for high prices is, famously, high prices.

The HBM oligopoly (Samsung’s share is about 20%) argues that AI changed the game and that their industry’s financial results will be more predictable and less prone to boom and bust cycles going forward. Not everyone’s convinced, and after parabolic moves in the shares, some investors are inclined to profit-taking.

I should note that the profit bonanza at Samsung prompted calls for a more equitable distribution of the windfall. The company’s set to fork over large bonuses this year to employees who had the audacity to suggest they should share in the fruits of their labor.