Samsung Electronics (005930.KS) Executive Chairman Jay Y. Lee made a surprise visit to the company's semiconductor facilities on Sunday, signaling his commitment to reclaiming Samsung's position as a technology leader and securing dominance in the next-generation chip market amid an unprecedented industry supercycle.
Lee inspected technologies for integrating artificial intelligence and robotics into manufacturing processes to strengthen production competitiveness across the memory division—now riding a supercycle—as well as the foundry and system semiconductor businesses that have been recovering their technological edge, according to people familiar with the matter.
Lee's choice to first visit the Giheung campus in Yongin, Gyeonggi Province, carries symbolic significance. While Hwaseong and Pyeongtaek serve as major production sites with large-scale manufacturing facilities, Giheung is where Samsung launched its semiconductor business in 1983 and has since transformed into a hub for next-generation research and development.
NRD-K (New Research & Development-K) within the Giheung campus is a 109,000-square-meter cutting-edge complex R&D center that Samsung is building to secure future semiconductor technologies. Samsung Electronics plans to invest a total of 20 trillion won ($14.6 billion) in NRD-K by 2030.
Samsung Electronics faced a difficult period through the first half of this year but now stands at a turning point to climb back to the top position. This explains why Lee visited the next-generation technology hub to demonstrate his technology-focused management approach.
After ceding the top spot in the global DRAM market to SK hynix for the first time in the first quarter of this year, Samsung Electronics is accelerating its efforts to reclaim the lead on the back of the semiconductor boom. In the third quarter, Samsung's global DRAM market share reached 32.6%, narrowing the gap with top-ranked SK hynix to just 0.6 percentage points. Industry observers believe Samsung reclaimed the top position in the fourth quarter, leveraging its industry-leading production capacity.
In the high-bandwidth memory (HBM) market, Samsung has already overtaken Micron. According to market research firm Counterpoint Research, Samsung Electronics' global HBM market share reached 22% in the third quarter, rising to second place. This is attributed to increased shipments of fifth-generation HBM (HBM3E) to Nvidia and growing orders for application-specific integrated circuits (ASICs) from global big tech companies.
While a significant gap with SK hynix remains, analysts say reclaiming the top position would not be difficult if Samsung's sixth-generation HBM (HBM4) business, set for mass production next year, proves successful. Samsung's HBM4 recently received top marks in speed and heat dissipation during Nvidia's internal testing, sources said.
Progress is also being made steadily, if slowly, in the foundry business. In July, Samsung signed a contract with Tesla to mass-produce next-generation AI6 chips, and in August, it agreed to manufacture Apple's image sensors for the first time. Recently, the company has been discussing plans to produce next-generation central processing unit chips for AMD, the second-largest graphics processing unit company after Nvidia, using cutting-edge processes. While TSMC continues to dominate the global foundry market, analysts expect Samsung's counteroffensive to begin in earnest once the successive big tech contracts are reflected in its earnings.
Lee's emphasis on technology is linked to his recognition that next year presents an opportunity for prepared companies to reap substantial profits. The semiconductor industry is expected to experience an unprecedented supercycle next year as cyclical upturn coincides with AI-driven data center investment and replacement demand for smart devices with enhanced AI capabilities. Samsung Electronics raised server DRAM prices by approximately 40% in the fourth quarter and is planning significant price increases for next year as well. Industry observers project Samsung could achieve operating profit approaching 100 trillion won ($73 billion) next year, driven by its semiconductor business.
However, Lee and senior executives are maintaining a vigilant posture. This is why Lee, after moving to the Hwaseong campus, held discussions with key executives and engineers behind cutting-edge semiconductor products including HBM and sixth-generation DRAM (D1c), gathering opinions from field employees. Through these meetings, Lee reviewed the status of next-generation technology development and listened to ideas for accelerating the recovery of technological competitiveness.
"Let us restore our fundamental technological competitiveness through bold innovation and investment," Lee told the employees, urging them to dedicate themselves to research for restoring Samsung's reputation as a technology leader.
"Chairman Lee's personal visits to Giheung and Hwaseong send a strong message that he intends to rebuild from the technological foundations," an industry official said. "It shows Samsung Electronics is making an all-out effort to fully reclaim leadership in core areas such as HBM and foundry ahead of next year's semiconductor supercycle."
