In the first quarter of this year, Samsung Electronics, which lost its position as the largest player in the global DRAM market to SK hynix, is expected to continue its focus on profitability through production cuts in the second half of the year. Samsung Electronics' semiconductor executives seem to be considering the possibility that DRAM demand may be weaker than expected, opting to maintain a production volume control stance for price stabilization rather than forcing an increase in output to gain market share.
According to industry sources on the 5th, Samsung Electronics is reportedly set to slightly reduce the wafer input amounts at its Hwaseong Lines 15 and 16, which are among its main DRAM production lines, starting in the second half of the year. This contrasts with SK hynix, which is significantly increasing its production volume driven by demand for high bandwidth memory (HBM). Consequently, SK hynix is expected to maintain its lead in DRAM market share throughout this year.
Market research firm TrendForce reported that SK hynix recorded $9.718 billion in sales in the first quarter, capturing a 36% market share to claim the top position in the DRAM market. Although SK hynix's sales decreased by 7.1% compared to the previous quarter, the increase in HBM3E shipment proportion helped maintain its average selling price (ASP) compared to the previous quarter, allowing it to rise to the lead.
In contrast, Samsung Electronics fell to second place in the DRAM market with sales of $9.1 billion, securing a 33.7% share in the first quarter. This marks a 19.1% decrease in sales compared to the previous quarter, primarily attributed to the drop in HBM shipments. It has been explained that the inability to sell HBM products directly in China and a substantial drop in high-priced HBM3E shipments following product redesigns have significantly impacted sales.
Some have speculated that Samsung Electronics may increase production capacity and wafer output in an effort to reclaim the top spot in DRAM, but there has been no significant movement on key production lines. A source familiar with Samsung Electronics noted, "The wafer production input in the second half of the year is expected to be more conservative than in the first half," and added, "Although market uncertainty is high, recent performance deterioration appears to have led to a preference for profitability over volume."
Currently, DRAM prices are on the rise, but uncertainties are growing, particularly with the potential for U.S. tariff policies to be implemented. As such, Samsung Electronics is expected to maintain its reduction policy while monitoring the situation. Earlier, TrendForce analyzed, "Concerns about the potential impact of tariffs and inflation on PC demand in the second half of the year still exist," and indicated that "the anticipated increase in DRAM prices may be revised down considering the potential for increased trade barriers."
The excessive accumulation of DRAM inventory by PC and smartphone manufacturers is also emerging as a factor for declining DRAM prices. Although global PC shipments increased by about 5% year-over-year in the first quarter, concerns are being raised that this demand may shrink in the second half. The extent of tariffs on IT devices by the U.S. government is expected to affect DRAM prices as well.
In contrast to the general DRAM market, HBM demand continues to expand steadily, suggesting that SK hynix's market share, revenue, and operating profit will consistently rise. DB Securities projects that SK hynix's revenue and operating profit for the second quarter will increase by 22% and 61%, respectively, year-over-year, reaching 20.1 trillion won and 8.8 trillion won, and stated, "Under strong demand for AI semiconductors, the proportion of HBM revenue within SK hynix's DRAM sales is expected to approach 44% in the second quarter."