Analysts have noted that Samsung lost ground in DRAM smartphone

Analysts have noted that Samsung lost ground in DRAM, smartphone and chip production – the company is certain of the opposite.

Samsung Electronics is having to convince partners and customers of the competitiveness of its semiconductor business after investors and analysts reported that it has started to lose ground in the market. Earlier this year, however, the South Korean company lost new orders from two of its biggest customers, Qualcomm and NVIDIA, who chose to work with TSMC.

Analysts indicated that these companies were frustrated by Samsung’s inability to ensure a steady supply of 4nm and 5nm chips. In the first quarter of 2022, TSMC held a 54% share of the chip-to-order manufacturing market, more than triple Samsung’s share, according to TrendForce.

Last year, Samsung announced plans to invest 171 trillion won ($151 billion) in chip manufacturing by 2030. However, TSMC plans to invest up to $44 billion in chip production this year, while Samsung’s annual investment will be just $12 billion, according to SK Securities.

Samsung has some difficulties not only in the area of ​​contract manufacturing. In the DRAM market, traditionally dominated by Samsung, competitors Micron Technology and SK hynix are bringing innovative solutions to market faster. Issues with the flagship Galaxy S22 smartphone, released in February, have sparked speculation that Samsung is lagging behind Apple in mobile devices, and performance and sales of Samsung’s Exynos 2200 mobile processors released this year have been underperforming. Samsung’s share of the smartphone processor market has almost halved since 2019, according to research firm Strategy Analytics. Last year, the South Korean company ranked fourth with 6.6%, compared to 37.7% from Qualcomm, 26.3% from MediaTek and 26% from Apple.

Investors, including hedge funds Petra Capital Management and Dalton Investments, have also raised concerns about Samsung’s rigid corporate culture, which is being pursued by Lee Jae-yong, vice chairman and de facto CEO. Accordingly, the company prioritizes rapid development and cost savings over quality and innovation.

“Technological advantages (Samsung) are crumbling, Dylan Patel, principal analyst at SemiAnalysis, wrote in a note to investors. — Samsung is hesitant in every aspect of technology development, including one area where it has historically crushed all competitors, DRAM.”

However, Samsung claims it still has a technological advantage over its rivals in manufacturing memory modules, citing faster adoption of EUV lithography for DRAM manufacture and a dominant DRAM market share of around 40%. Samsung held a gala last week to launch shipments of 3nm chips, a new generation of non-memory chips. The company also said it is implementing a challenge-handling culture based on the involvement of all parties through “open communication” with employees.


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Johnson Smith

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