Recently, Samsung Electronics suddenly changed the head of the Foundry model department and DRAM department in an unconventional personnel season, which was interpreted by the market as a means to make up for the sluggish performance of storage semiconductors in the first half of the year and strengthen the foundry business.
It is reported that Jegae Jeong, Vice President of the Technology Development Department of Samsung's OEM Business Unit, has been appointed as the Chief Technical Officer (CTO) of the business unit, and his successor is Jahun Koo. The department head responsible for DRAM development in storage semiconductors has also been replaced, taking over by Hwang Sang jun, who previously served as the vice president of the strategic marketing department. This has been interpreted by the industry as a focus on the development of HBM technology.
Samsung announced its first quarter operating performance as of March 31, 2023, with a consolidated revenue of 63.75 trillion won, a 10% decrease from the previous quarter. The Device Solutions (DS) business unit had a consolidated revenue of 13.73 trillion won and an operating loss of 4.58 trillion won in the first quarter.
Currently, the heads of Samsung's senior development, design, and strategic marketing departments are You Chang shik, Oh Tae young, and Yun Ha young, respectively.
The inventory adjustment of PC and consumer product markets is higher than expected. The mature process of Foundry model and some relatively advanced 7/8nm capacity utilization have been greatly affected, which naturally includes TSMC. However, TSMC's customer base is relatively broad, and Samsung's Foundry model customer base is more concentrated, which has been significantly impacted. Samsung reported in the first quarter of this year that they had to lower prices to grab orders.
Samsung took the lead in introducing the 3nm process of GAA technology, but it does not seem to pull back Samsung's position in the field of Foundry model. In the first quarter of this year, the capacity utilization rate of 8 inches and 12 inches declined, but in the second quarter, some of its 3nm new product output will officially contribute to revenue.
However, from TrendForce's 2023Q1 ranking of the world's top ten wafer foundries in terms of revenue, the market share of grandstand has increased, and it has a stronger ability to resist the risk of market turbulence. Samsung's market share has actually declined.
The sudden adjustment of Samsung's two departments may reflect the current situation faced by the company. Korean media have stated that Samsung Electronics' DRAM production has dropped to its lowest level since the third quarter of 2021. The company has reduced its monthly DRAM production to 620000 wafers in July, a decrease of more than 12% annually.
Samsung Electronics has disclosed preliminary verification data, estimating sales of 60 trillion Korean won in the second quarter of 2023, a year-on-year decrease of 22.3% and a month on month decrease of 6%; The operating profit was 0.6 trillion won, a year-on-year decrease of 95.7% and a month on month decrease of 6%. Operating profit reached its lowest level in 14 years since the first quarter of 2009 (590 billion won).
However, as large technology companies such as Google, Apple, and Microsoft expand their AI services, the demand for low-power, high specification storage semiconductor HBM will significantly increase. Samsung plans to invest 1 trillion Korean won to expand the production capacity of next-generation memory semiconductor high bandwidth memory (HBM) to meet the needs of AMD, Nvidia, and others. It is reported that Samsung Electronics has received orders from AMD and Nvidia to increase HBM supply. Samsung plans to mass produce next-generation products such as HBM2 and HBM2E, as well as the 8-layer stacked HBM3 and the recently completed 12-layer HBM3E in the second half of the year.
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