Samsung: HBM3e Chips to Boost Revenue by 60% in 2024

Samsung Electronics is set to commence mass production of its fifth-generation high-bandwidth memory (HBM) chip, HBM3e, within this year, with a strategic goal of significantly boosting its revenue contribution. The company projects that its cutting-edge HBM3e chip will account for over 10% of total HBM sales this quarter, rising sharply to 60% by the final quarter of the year. Kim Jaejune, head of memory sales and marketing at Samsung, confirmed the supply to multiple clients, although specific names were not disclosed.

NVIDIA stands out as a pivotal customer, with both Samsung and rival Micron competing for its business. The anticipated rapid growth suggests that Samsung is likely supplying the world’s leading artificial intelligence (AI) accelerator manufacturer, which heavily relies on HBM technology. To date, South Korean counterpart SK Hynix has been NVIDIA's primary supplier.

Reports indicate that Samsung has secured approval from NVIDIA for a portion of its AI-focused memory chips. The company foresees a 3.5-fold increase in HBM sales in the latter half of this year compared to the first half, with plans to double its memory supply by 2025.

Driven by the AI boom and resulting surge in semiconductor sector profits, Samsung Electronics has announced its fastest net income growth since 2010. On July 31, Samsung reported a sixfold increase in second-quarter net profit, reaching 9.64 trillion won (approximately $6.96 billion), exceeding analysts' average forecast of 7.97 trillion won. Earlier, Samsung revealed a 15-fold increase in preliminary operating profit and a 23% rise in revenue, marking the largest sales growth since 2021.

Bolstered by rising memory prices and robust demand, Samsung’s semiconductor division achieved an operating profit of 6.45 trillion won ($4.7 billion), recording a second consecutive quarter of profitability following four quarters of losses.