Samsung is in a hurry

【Lansheng Technology News】According to news on November 14, according to Samsung’s financial report, Samsung Semiconductor’s equipment solutions business suffered losses of 4.85 trillion won, 4.36 trillion won and 3.75 trillion won respectively in the first three quarters, with a cumulative loss of 12.96 trillion won.

In the first half of this year, affected by the downturn in the semiconductor industry, Samsung Electronics' performance collapsed. Compared with a year ago, net profit plummeted 95%, hitting the lowest level in 14 years.

It is understood that Samsung Electronics’ operating profit in the third quarter was 2.43 trillion won, a year-on-year decrease of 77.60%; sales were 67.40 trillion won, a year-on-year decrease of 12.21%; net profit was 5.84 trillion won, a net profit of 9.39 trillion won in the same period last year. A year-on-year decrease of 37.80%.

This is not the most serious quarter for Samsung Electronics to see its net profit decline this year. In the first and second quarters of this year, Samsung Electronics’ net profit decline was even more severe. Among them, Samsung Electronics’ net profit in the second quarter was 1.72 trillion won, a year-on-year decrease of 84.50%; in the first quarter, Samsung Electronics’ net profit was 1.57 trillion won, a year-on-year decrease of 86.13%.

Behind the sharp decline in net profit, the semiconductor business has suffered continuous losses, becoming the company's business unit with the most serious losses this year. In the first three quarters, Samsung Electronics' semiconductor equipment solutions (DS) business suffered losses of 4.85 trillion won, 4.36 trillion won and 3.75 trillion won respectively, with a cumulative loss of 12.96 trillion won.

In the first half of this year, affected by the downturn in the semiconductor industry, Samsung Electronics' net profit fell by more than 84% year-on-year in the first two quarters, the largest decline in the past 14 years.

According to reports, affected by the new crown epidemic, people's demand for electronic consumption has gradually declined, which has also led to a reduction in demand in the semiconductor industry. Global semiconductor revenue in the first quarter of this year was US$120.5 billion, a 9% decrease from the previous quarter. This is the fifth consecutive quarter of decline in the semiconductor market.

In the entire semiconductor market, memory chips are the worst. You must know that the memory chip market accounts for 1/4 of the semiconductor market, but due to weak market demand, the market share has dropped to 16% in the first quarter of this year.

For Samsung, it hits the mark. Because semiconductors are Samsung's pillar industry, operating profits account for almost half of Samsung's, and memory chips are the main business of semiconductors, accounting for 80% of revenue. According to data, Samsung’s current semiconductor inventory backlog has exceeded 180 billion yuan.

But in addition to being unable to sell chips, Samsung is also facing the crisis of market share being eroded. In the current AI era, old memory chips such as Samsung's DRAM and NAND will be gradually eliminated, and the new memory chip HBM will become mainstream. But in the area of HBM chip R&D and production, before Samsung could react, its old rival SK Hynix already had more than 50% of the market share. It also jointly developed AI chips with Nvidia and exclusively occupied 90% of the high-end market share. .

Samsung, which has failed to seize the dividends of AI, can be said to have fallen behind step by step. It cannot sell memory chips, has a backlog of semiconductor inventories, and has seen its net profit plummet.