Samsung Electronics has issued an apology for its poor third-quarter profits, which were nearly four times greater than the same period last year but fell short of analysts’ forecasts. The company has struggled to compete in the AI chip industry, falling behind rivals such as SK Hynix in the supply of high-bandwidth memory (HBM) chips. Samsung’s issues include sales delays for its sophisticated HBM3E chips, as well as competition from Chinese chipmakers in conventional goods. Despite these challenges, the corporation has promised to strengthen its technological competitiveness.
The emergence of AI-powered technology has changed the semiconductor market, with high-margin chips required for AI servers emerging as a key growth sector. Samsung, a long-time memory chip market leader, is experiencing severe competition, notably in advanced AI processors, from both global and Chinese competitors. The company’s choice to change its semiconductor division CEO earlier this year indicates a strategy shift to regain lost ground and enhance its position.
Samsung is also under pressure from other factors, such as delayed shipments of its latest HBM3E semiconductors and lower demand for commodity chips used in PCs and smartphones. These reasons, together with its challenges with AI chip manufacture, have raised doubts about Samsung’s technological competitiveness.
As Samsung navigates these hurdles, it sees an opportunity to turn the tide by focusing on R&D. The bigger concern is how the IT behemoth will position itself in the fast changing AI-powered chip industry. With strategy reforms and a focus on long-term innovation, Samsung hopes to reclaim its competitive advantage.
