Samsung Benefits from DRAM Shortage but Faces Foundry Challenges
Samsung is currently enjoying substantial financial gains thanks to the ongoing DRAM shortage, with projections estimating its operating profit could reach a staggering $73 billion by 2026. This surge is largely driven by market conditions rather than Samsung’s own competitive edge. Despite these lucrative returns in memory manufacturing, experts suggest that Samsung’s foundry division still has significant hurdles to overcome if it aims to rival industry leader TSMC.
According to United Daily News, the latest details have emerged.
Key Areas of Progress and Struggles
Samsung has made notable strides in semiconductor innovation, particularly with the announcement of the Exynos 2600 chipset, which utilises the world’s first 2nm Gate-All-Around (GAA) process. This advancement marks a significant technological achievement and indicates Samsung’s commitment to advancing its foundry capabilities. However, an industry expert has highlighted that Samsung is lagging behind competitors in three critical areas: High Bandwidth Memory (HBM) production compared to SK hynix, wafer foundry business growth, and mobile product competitiveness.
When Samsung began mass production of the Exynos 2600, initial yields were around 50 percent, with targets set to improve to 70 percent. The company has also secured a multi-billion-dollar deal with Tesla and started fulfilling orders for Chinese cryptocurrency equipment manufacturers, signalling growing confidence in its foundry output despite ongoing challenges.
Market Context and Strategic Outlook
According to estimates shared by the World Semiconductor Trade Statistics (WSTS) and reported by United Daily News, memory revenue is expected to grow by nearly 28 percent in 2025, making it the second largest segment in the semiconductor industry. Tsai Cho-shao, Deputy Director of DigiTimes, emphasises that Samsung’s current profitability boost is mainly due to favourable market shifts rather than intrinsic competitiveness. Samsung’s foundry business is reportedly targeting profitability by 2027, but deciding where to allocate resources remains a strategic challenge given the company’s broad portfolio and competitive pressures.
Samsung is also navigating some internal difficulties, including investigations into alleged corruption involving employees reportedly accepting bribes to divert memory supplies. This highlights some of the complexities Samsung faces as one of the few major memory manufacturers globally.
Looking Ahead
While Samsung’s position in the memory market appears strong for the near term, its foundry division still has a long road ahead to compete with TSMC’s dominance. The company’s ongoing efforts with cutting-edge manufacturing processes and strategic partnerships are promising, but it will likely take several years before Samsung can be considered a true rival in the foundry space. Industry watchers will be keen to monitor Samsung’s progress over the coming months and years to see how effectively it can leverage its resources and innovation to close the gap.
For more detailed insights, the original analysis can be found through the United Daily News report.