Samsung Electronics "Q3 DRAM Market Share Recovers to 40% Range"... Early Q4 Profit Turnaround Expected

41.0% Estimate Presented Through Quarterly Report
Will Q2 Recover from 30% Range Market Share Decline?

Market Expects DRAM Profit Turnaround in Q4
"Memory Product Shipments and Price Increases Anticipated"

Amid signs of improvement in the semiconductor market, attention is focused on whether Samsung Electronics has raised its DRAM market share from the 30% range in the second quarter to the 40% range in the third quarter. There are also forecasts that Samsung Electronics could achieve a DRAM profit turnaround in the fourth quarter earlier than expected.

On the 16th, Samsung Electronics announced in its quarterly report that its DRAM market share for the third quarter was 41.0%. It also explained that this figure was an internal estimate. Samsung Electronics disclosed this estimated market share while market research firms have yet to release statistics related to the third quarter DRAM market.

Market research firms estimated that Samsung Electronics recorded a DRAM market share in the high 30% range in the second quarter. Specifically, Omdia suggested 38.2%, and TrendForce suggested 39.9%. For Samsung Electronics, the world’s number one DRAM company that had maintained a market share in the 40% range, these numbers were surprising. It was a situation where the company had to be quite concerned about the decline in market share.

Samsung Electronics recorded a 42.8% market share in the first quarter (based on Omdia). Also, the annual market shares for last year (43.1%) and 2021 (43.0%) were in the 40% range. Although there were concerns that the market dominance might weaken as the share dropped to the 30% range, it appears to be recovering in the third quarter.

In this regard, Samsung Electronics stated in its third-quarter conference call last month that it increased sales of high-value-added DRAM products and raised the selling prices of some products. As a result, DRAM bit growth (the production increase rate converted into bit units) rose by about 10% compared to the previous quarter, and the average selling price (ASP) of products also increased slightly. Samsung Electronics described the growth rate as a "mid-single-digit percentage (%)."

Kim Jae-jun, Vice President of Samsung Electronics’ Memory Business Division, explained, "As the perception of the market bottom spread, we received numerous purchase inquiries from customers aiming to secure component inventory. In the atmosphere of market stabilization, we focused on improving profitability and continuously expanded sales of advanced products such as High Bandwidth Memory (HBM) and Double Data Rate (DDR) 5."

The semiconductor industry is paying close attention to whether Samsung Electronics will improve its DRAM performance in the fourth quarter. Although Samsung Electronics recorded operating losses in its DRAM business from the first to the third quarter, there are securities firms’ forecasts that it could turn profitable in the fourth quarter. Seoseung-yeon, a researcher at DB Financial Investment, said, "With continued AI server demand and inventory accumulation demand from mobile customers, steady memory shipments and price increases are expected. DRAM is expected to turn profitable." IBK Investment & Securities and Hanwha Investment & Securities have projected Samsung Electronics’ fourth-quarter DRAM operating profit at 276 billion KRW and 940 billion KRW, respectively.

Samsung Electronics plans to actively respond to demand for high-value-added products, supported by the improving memory market conditions. The company forecasted that as the memory market recovery trend accelerates in the fourth quarter, the price increase range will expand compared to the previous quarter. It stated that in the fourth quarter, it plans to "expand the sales proportion of high-profit products such as automotive memory and actively expand mass production and sales of HBM3 in response to the growing demand for generative AI."

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