Why Samsung Electronics and SK Hynix Can't Smile Even After Reaching 70% Share

2Q DRAM Market Sees Increased Korean Share
Memory Semiconductor Sector Faces Downturn
Focus on Potential Production Cuts
Market Rebound Expected Sooner

[Asia Economy Reporter Kim Pyeonghwa] Samsung Electronics and SK Hynix each increased their market share in the DRAM semiconductor market in the second quarter, jointly accounting for more than 70%. However, despite these achievements, domestic companies face significant challenges as the semiconductor market, centered on memory, continues to slump.

According to market research firm Omdia on the 17th, Samsung Electronics ranked first in the global DRAM market share in the second quarter with 43.4%. SK Hynix took second place with 28.1%. Both companies increased their market shares by 0.7 percentage points and 1 percentage point respectively compared to the previous quarter. Unlike the third-ranked U.S. company Micron (23.6%), which saw a 1.2 percentage point decline from the previous quarter, domestic companies expanded their presence, raising their combined share to 71.5%.

Samsung Electronics and SK Hynix also demonstrated leadership in the global NAND flash market in the second quarter. Samsung Electronics held the top spot with a 33.3% market share. Although this was a 2.2 percentage point decrease from the previous quarter (35.5%), the gap with the second place remained significant. SK Hynix recorded second place with a 20.4% market share, up 2.3 percentage points from the previous quarter.

The market acknowledges that while domestic semiconductor companies showed clear memory performance in the second quarter, concerns remain high. This is due to the ongoing downturn centered on memory semiconductors. Various factors such as inflation, weak demand, and the Russia-Ukraine war have worsened market conditions, severely impacting the memory industry, which is highly sensitive to economic cycles. Inventory accumulation and price declines have led some companies, including Micron and Japan's Kioxia, to announce production adjustments despite incurring losses.

Given this situation, industry attention is focused on whether domestic companies will implement production cuts. Samsung Electronics and SK Hynix maintain that there will be no artificial adjustments, but market insiders speculate that some supply control could be possible through production process transitions or line changes, even if not on a large scale. Market research firm TrendForce forecasted that supply oversupply and inventory pressure in the memory market could continue this year and next, making production adjustments by manufacturers inevitable.

However, the accelerated timing of semiconductor market recovery forecasts is a positive factor. U.S. investment bank Morgan Stanley recently predicted in a report that the semiconductor cycle will recover in the second quarter of next year, with a rebound expected in the second half. The securities industry views the ongoing announcements of production cuts by semiconductor manufacturers as a signal that the market has bottomed out.

This content was produced with the assistance of AI translation services.