Memory giant Samsung Electronics posted solid numbers for its Q2 financial results, reaching $7.5 billion. Good market conditions have contributed to a higher average sales price (ASP), and combined with robust sales of its OLED panels, Samsung has had a great Q2.
In 2H24, Samsung expects to see the memory market continue its recovery thanks to strong demand for HBM, conventional DRAM, and server SSDs. Ongoing investments in AI by cloud service providers and businesses for on-premises servers are also helping boost growth. While PC demand remains weak, mobile product demand have stayed stable as orders by Chinese original equipment manufacturers (OEMs) rise.
Through 2H24, Samsung projects that AI servers will hold a larger portion of the market due to cloud service providers and enterprises expanding investments in artificial intelligence. Thanks to the meteoric rise in large language models (LLMs) and generative AI applications, the number of organizations investing in these technologies grows. TrendForce writes that AI servers equipped with HBM also “feature high content-per-box with regards to conventional DRAM and SSDs [so] demand is expected to remain strong across the board from HBM and DDR5 to SSDs.”
Financial strength and rising market conditions have pushed Samsung to expand its HBM3e and high-density products capacity. This is a big leap, but Nvidia certifying Samsung’s products for its H20 components tailored to the Chinese market could be a considerable gain. On the NAND side, Samsung announced it will strengthen the supply of triple-level cell (TLC) SSDs and address customer demands for quad-level cell (QLC) products for all applications.
Similarly, Samsung has seen considerable interest in its progress on the foundry side, with solid demand for its 3 nanometer (nm) technology expanding in the second half of the year. Samsung has drawn an ambitious roadmap for its future, detailing expanded order intake for AI and high-performance computing (HPC) applications, with a fourfold increase in customer base and a ninefold increase in sales by 2028.
The current memory market could support these lofty goals, especially with companies planning to further their AI investments. However, that’s if market conditions don’t take a major hit by geopolitical conflict or other disruptions.
Despite robust demand, DRAM and NAND spot prices have lacked momentum. In the absence of stocking demand in July, spot prices didn’t show significant fluctuations, mostly because consumer electronics demand has yet to rebound. A typhoon in Taiwan also suspended spot trading, leading buyers to wait for further developments.
This precarious position could see further complications if the United States decides to act, imposing new export restrictions on American technology and memory.