Is the pressure too high for HBM? Samsung replaces chip chief

Driven by the wave of artificial intelligence, two leading memory chip companies, Samsung and SK Hynix, are intensifying their technical investments in High Bandwidth Memory (HBM) chips to compete for dominance in this emerging market.

This Tuesday, Samsung Electronics appointed a new semiconductor business chief, Zheng Rongxuan, aiming to strengthen the company's competitiveness in the field of AI chips. The company stated in a press release that Zheng Rongxuan has rich management experience in Samsung's memory and battery manufacturing departments, qualifying him for the role of semiconductor business chief.

Samsung also stated that the purpose of this personnel change is to "enhance the company's competitiveness in a globally uncertain business environment." Former semiconductor business chief, Jiang Jiehuan, will be transferred to the Future Business Department to focus on exploring new growth opportunities and managing Samsung's Advanced Technology Research Institute.

Currently, Samsung is in fierce competition with fellow South Korean company SK Hynix, striving to produce the most advanced memory chips and seize market share in the HBM field.

In terms of scale and market share, Samsung is undoubtedly the leader in the memory chip industry, with SK Hynix in second place. However, in the HBM field, SK Hynix has maintained a leading position and is the exclusive supplier of NVIDIA's HBM3 chips. Nevertheless, there have been reports that NVIDIA is considering including Samsung as an HBM supplier to address SK Hynix's capacity shortage issue.

Kazunori Ito, head of Morningstar's stock research department, stated in a report earlier this month:

We expect the competition in the high bandwidth memory market to intensify further by 2025. In the era of HBM3, SK Hynix is the exclusive supplier to NVIDIA, and we believe there is a technological gap between SK Hynix and Samsung for several quarters.

However, Samsung appears to be rapidly narrowing this gap. South Korean media reports suggest that Samsung is expected to achieve mass production of the latest 12-layer HBM3E chips in the second quarter of this year, ahead of SK Hynix's third-quarter mass production of HBM3E.

Kazunori Ito believes that this indicates Samsung is quickly closing the technological gap with SK Hynix. He predicts that in the future, Samsung, SK Hynix, and the third-largest memory chip manufacturer, Micron, will all have the capability to supply NVIDIA with HBM3E, intensifying price competition.