Samsung Electronics continues to chop again its reminiscence chip manufacturing, together with NAND flash utilized in smartphones and PCs, after reporting a $3.4 billion (4.36 trillion gained) working loss within the second quarter of this yr in its reminiscence chip unit. The world’s greatest reminiscence chip maker posted a roughly $7 billion working loss in its semiconductor enterprise for the final six months.
The transfer comes after Samsung slashed its reminiscence chip manufacturing in April after hitting the worst quarterly earnings since 2009 as demand for shopper gadgets remained weak.
The tech large, nevertheless, is aiming to generate a brighter AI image for the long run: it mentioned that it plans to double down on producing high-performance reminiscence chips like excessive bandwidth reminiscence (HBM) by 2024 as a consequence of sturdy AI demand. HBM, utilized in AI, 5G, the Web of Issues (IoT) and graphic processing purposes, gives sooner information processing and decrease energy consumption in comparison with the normal NAND.
“Server demand remained weak as clients continued to regulate inventories, however demand for high-density/high-performance merchandise stayed sturdy, pushed by elevated investments specializing in AI by main hyperscalers,” the corporate mentioned.
On an earnings name right this moment, the chief vp of Samsung’s reminiscence division Jaejune Kim mentioned it might proceed its reminiscence chip manufacturing cuts, modify for particular merchandise, however will double its capacities of high-performance reminiscence chips, together with HBM, because the demand for these superior reminiscence chips is predicted to develop regularly.
Two predominant reminiscence chips — DRAM and NAND — are utilized in gadgets from smartphones to servers at information facilities. For instance, DRAM reminiscence allows massive language fashions, together with Open AI’s ChatGPT, to carry out extra superior capabilities. DRAM additionally helps pace up course of information for multitasking and constructing complicated AI purposes. NAND helps retailer information.
Samsung laid out its plan for the foundry enterprise to introduce 2-nanometer production for mobile phone parts by 2025.
The agency reported Thursday its companywide working earnings of 670 billion gained (roughly $524 million) within the second quarter of 2023, down from 14.1 trillion gained a yr earlier. The determine is best than anticipated than Samsung’s preliminary report issued earlier this month, estimating its Q2 working earnings would probably be a 96% plunge, 600 billion gained ($459 million).
Regardless of working earnings dropping 95% within the second quarter, Samsung expects world demand for reminiscence chips to rebound progressively within the second half of this yr.
“World demand is predicted to progressively recuperate within the second half of the yr, which ought to result in an enchancment in earnings pushed by the element enterprise, ” Samsung mentioned in a press release. “Nevertheless, continued macroeconomic dangers may show to be a problem in such restoration in demand.”
Simply yesterday, Samsung unveiled its newest machine fashions — Galaxy Z fold 5, flip 5, Galaxy Faucet S9 and Galaxy Watch 6/ Watch 6 Traditional — on the “Unpacked” worldwide product launch occasion in its house nation for the primary time.