After Nvidia, Samsung promises to abandon consumer focus and focus instead on lucrative enterprise market: a surge in HBM, enterprise SSDs and DDR5 server memory chips expected to boost margins
Nvidia has transformed into an AI superpower, becoming the third most valuable company in the world, so it is perhaps no surprise that other tech giants are watching with envy and shifting their focus to follow suit.
During its recent earnings call, Samsung reported consolidated operating profit of $4.8 billion in the first quarter – a tenfold year-over-year increase – and company executives revealed a change in focus going forward.
The plan now is to focus on producing high-capacity HBM and DDR5 memory and SSD chips for the enterprise market, rather than focusing on consumer PCs and mobile devices.
Meeting demand
“We plan to increase the supply of HBM chips more than threefold in 2024 compared to last year,” Kim Jae-june, vice president of Samsung’s memory business, said on the call. Korea Economic Journal. “We have already completed discussions with our customers about the supply of HBM chips this year. In 2025, our HBM chip production will double compared to this year. Our discussions about the 2025 volume with our customers are also going well.”
Samsung, currently number 23 in the world, has already invested heavily in HBM, but is currently lagging behind its arch-rival SK Hynix in this area. SK Hynix recently announced plans to build the world’s largest chip factory and has partnered with Taiwanese foundry TSMC to produce HBM4.
Samsung said it expects a 50% increase in server DRAM production in the second quarter, and double server SSD output in terms of bit growth. The company believes that robust demand for AI chips will continue and chip supply will increase throughout the year.
The South Korean tech giant also announced that it will begin mass production of its 8-layer HBM3E chips this month.