SEOUL – The first quarter (Q1) performance of Samsung Electronics and SK Hynix is expected to be uneven, depending on their high-bandwidth memory (HBM) businesses.
According to industry sources on the 6th, memory industry sales are showing signs of declining again starting in Q1 this year.
Memory DRAM sales in the semiconductor industry recorded an all-time high in the fourth quarter of last year. After hitting bottom in the first quarter of 2023, it continued its growth trend for the past seven quarters.
However, due to sluggish IT demand recovery in PCs, smartphones, etc., and the offensive of low-priced memory from China, DRAM sales in Q1 this year are expected to turn downward. NAND flash memory is also likely to turn to a deficit compared to the previous quarter due to the overall slump in demand.
In the memory industry, it is believed that performance in the first half of this year will vary depending on the HBM business.
In the case of Samsung Electronics, the HBM business may continue to experience sluggish demand in Q1 this year.
In general, the first quarter is the off-season for the memory industry, and HBM exports to China, which had been exported due to US export controls, have also been halted. In the earnings announcement last month, Samsung Electronics said, "After the announcement of our improved HBM products, demand from major customers shifted to improved products, which may cause a temporary demand gap for HBM."
SK Hynix is evaluated to be performing better than its competitors due to its strength in the HBM market, despite the sluggish IT demand and the off-season situation in the industry, as well as increasing uncertainties.
Some even predict that SK Hynix's DRAM business sales could surpass those of Samsung Electronics. Samsung Electronics has never relinquished its No. 1 position in the world for DRAM semiconductors for 33 years since 1992.
However, depending on the proportion of high-value-added HBM sales, sales performance is experiencing fluctuations.
According to preliminary research results from market research firm Gartner, the total revenue of the HBM market this year is expected to reach $19.8 billion, an increase of 66.3% from the previous year.
The proportion of HBM in total DRAM sales is also expected to expand further from 13.6% last year to 19.2% this year. In fact, the performance of the memory industry this year depends on HBM.
The first quarter of this year is a watershed moment.
The securities industry's estimated DRAM sales for Samsung Electronics in the first quarter are around 10 trillion to 13 trillion won. On the other hand, SK Hynix's DRAM sales are estimated at 12 trillion to 13 trillion won.
According to a recent report published by LS Securities, Samsung Electronics and SK Hynix are expected to have a close market share of 38% each in the DRAM market this year.
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