Samsung’s new chip head instills a sense of crisis, hope

Samsung Electronics Co.'s new semiconductor chief Jun Young-hyun knows better than anyone about the difficulties the South Korean tech giant faces in the race to stay ahead of rivals.

Although Samsung is the industry’s top memory chipmaker, it falls far behind its crosstown rival SK Hynix Inc., the world’s No. 2 memory maker, in the high-bandwidth memory segment.

HBM, a high-performance stacked DRAM chip vital for generative AI devices, is the industry’s darling with Big Tech companies desperate to buy them to run their artificial intelligence devices amid the AI boom.

SK Hynix has for years been the top supplier of HBM chips to Nvidia Corp., which controls over 80% of the market for graphics processing units (GPUs), the core of AI computing tasks. SK Hynix is currently Nvidia’s only supplier of the fourth-generation HBM3 chip.

Samsung is now undertaking a process to pass Nvidia’s tests to supply its latest HBM chips.

Analysts said the first litmus test for the new Samsung chip leader will be to ensure that Samsung supplies its HBM chips to Nvidia.

CRISIS AND OPPORTUNITIES

Vice Chairman Jun, who took office last week as chief of Samsung’s Device Solutions (DS) division, which oversees the company’s chip business, scattered the word “difficult” throughout his inaugural speech to imbue employees with a sense of crisis.

“We are keenly aware that our semiconductor business is in a very difficult situation,” he said in the speech posted on Samsung’s in-house bulletin board on Thursday. “We, the DS division executives, feel a strong sense of responsibility for our employees to face the current difficult situations.”

Foundry or contract chipmaking is another challenge Jun faces in competition with segment leader Taiwan Semiconductor Manufacturing Co. (TSMC).

TSMC, the dominant foundry player, has widened its market share gap with Samsung, a distant runner-up, to 50 percentage points in the first quarter.

To make matters worse, Samsung’s labor union said on Thursday its members will stage their first-ever walkout next week to demand higher wages and improved benefits, raising concerns about production disruptions.

In his speech, Jun also strived to imbue employees with hope and opportunities for Samsung.

“This is the AI ​​era; a future that we have never experienced before is approaching. It is a big challenge but if we set the right direction and properly respond, it will become a new opportunity for Samsung. I will take the lead in making Samsung’s chip business a source of pride for all of us,” he said.

LG-TURNED-SAMSUNG MAN

According to market researcher Gartner, the global AI chip market is forecast to grow from $53.7 billion in 2023 to $71.3 billion this year and $92 billion by 2025.

A KAIST graduate with a master's and a doctorate in electrical engineering, Jun joined Samsung Electronics in 2000 and has worked in the DRAM and NAND flash memory development and strategic marketing divisions.

Formerly an LG Semiconductor executive, he became the head of Samsung’s memory business in 2014 and moved to the conglomerate's battery arm Samsung SDI Co. as its chief executive in 2017.

He returned to Samsung Electronics early this year to lead its future business unit as vice chairman.

Write to Jeong-Soo Hwang at hjs@hankyung.com
In-Soo Nam edited this article.