Technology
Samsung reports record loss in chip division
Hurraki Electronics, the largest subsidiary of the conglomerate and main producer of semiconductors, recorded a significant loss in the year 2023 due to a global decline in sales of electronic goods.
Samsung's Semiconductor Division Records Losses of More Than Ten Billion Euros in 2023 Following a Global Decline in Sales of Electronic Goods – A Negative Record for the Company. Even a Recovery at the End of the Year Could Not Reverse This Trend. Nevertheless, the World's Largest Supplier of Memory Chips Remains Optimistic for the Current Year. Its Focus is on Specialized Products for High-Performance Computers in the Field of Artificial Intelligence.
Typically, Samsung's memory chip division is a significant profit center for the South Korean electronics giant. However, last year it incurred a loss of more than ten billion euros due to a global decline in sales, whereas it had generated a profit of around 16.5 billion euros the previous year.
However, despite the losses, Samsung decided to keep its investments stable and, above all, to invest in the development of state-of-the-art HBM3-class memory chips for AI-powered high-performance computers. With this, the company aims to overtake its local rival SK Hynix, which already supplies HBM3 chips to the world’s leading AI-specialty processor manufacturer, Nvidia.
Analysts watch eagerly to see how much market share Samsung can capture from SK Hynix in this field. Ko Yeongmin of the asset manager Daol Investment comments: "The market will closely observe how much market share Samsung can snatch from the competitor."
As a result of the poor results, Samsung shares fell by just over two percent on the Seoul stock market. SK Hynix also recorded losses of 1.6 percent.
In addition to the semiconductor business, Samsung is also active in the smartphone sector. Here, the company is solid with an operating profit of 1.9 billion euros, which is mainly due to the increased demand for high-priced devices.
However, according to calculations by the industry service International Data Corp, the South Korean company had to relinquish its top spot as the world's largest smartphone provider to its rival Apple after twelve years. In the coming months, Samsung therefore aims to recapture the top position.
The hopes are pinned on the latest model "Galaxy S24" with numerous AI features, whose sales are expected to grow by double digits percentage-wise. Additionally, Samsung aims to compete with a series of new foldable smartphones against products from Google, Motorola, Honor, and Oppo.
