Samsung Electronics’ semiconductor division underperformed expectations, reporting lower-than-expected operating profit as it fights to close the gap with SK Hynix in the AI-driven high-bandwidth memory (HBM) market. The company secured Nvidia’s approval for its 8-layer HBM3E, but only for China-focused AI processors, while SK Hynix and Micron continue to dominate the premium segment. Samsung’s HBM sales remain constrained due to U.S. export controls and customers waiting for improved chips, forcing the company to restructure its engineering team and push aggressively into next-gen HBM4. Meanwhile, SK Hynix has seen record profits, with HBM making up 40% of its DRAM revenue and expected to double in 2025. Samsung hopes to rebound by cutting exposure to lower-margin DRAM and NAND while doubling down on AI memory.
My Take
To regain competitiveness, Samsung has restructured its semiconductor division, cutting over 100 senior executives and appointing new leadership, including Jun Young-hyun as co-CEO, Han Jin-man as foundry president, and Nam Seok-woo as foundry CTO. These changes aim to strengthen Samsung’s position in HBM and foundry operations amid growing pressure from SK Hynix and Micron. AI memory is no longer just about capacity—it’s a performance-driven market where Nvidia’s certification and strategic partnerships determine winners. Without a faster HBM roadmap, Samsung risks falling further behind SK Hynix and Micron, who are solidifying their dominance.
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Credit: Bloomberg
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