Will Samsung benefit from Nvidia’s new AI chip delays?

Samsung Electronics Co., the world’s top memory chipmaker, is expected to benefit from Nvidia Corp.’s delays in shipping AI chips, as global Big Tech firms potentially seek alternatives to the AI semiconductor giant.

Last week, Nvidia notified Microsoft, Google and other major customers that shipments of its Blackwell AI accelerator will be delayed at least three months over design flaws, US media reported.

The delays are expected to spur Big Tech companies to seek products by Nvidia’s rivals such as Advanced Micro Devices Inc. (AMD), industry sources in Seoul said on Sunday. Microsoft and Google have already been developing next-generation products with AMD; the former has purchased the MI300X, an AI accelerator by the US fabless semiconductor designer.

Samsung supplies fourth-generation High Bandwidth Memory3 (HBM3) chips to AMD and is almost certain to furnish the fifth-generation HBM3E.

“It is very risky for a specific company to dominate the AI chip supply chain,” said a semiconductor industry source in Seoul. “Samsung and AMD will have opportunities.”

Nvidia dominates the global AI accelerator sector with a 97.2% market share last year, according to industry tracker TechInsights Inc.

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In March, Nvidia unveiled the Blackwell series, which the company said allows customers to build and run real-time generative AI on trillion-parameter large language models at up to 25 times less cost and energy consumption than its predecessor.

The crux of the issue reportedly lies in the processor die connecting two Blackwell graphics processing units on the GB200, its top-end model, according to media reports.

Tech-industry media The Information reported that the Blackwell AI accelerator is expected to be delivered to customers no earlier than the first quarter of 2025.

Nvidia said production of AI accelerators is on track to increase in the second half, adding that the company would not comment on market rumors.

The delays in the Blackwell series production are likely to drag Big Tech companies’ plans to expand their AI businesses, raising concerns over the market's dominance by one company.

Nvidia’s key customers have already placed tens of billions of dollars worth of orders for the GB200, prompting Nvidia to ask Taiwan Semiconductor Manufacturing Co. (TSMC) to ramp up production of the chip by 25%.

TSMC is a dominant foundry player in the AI accelerator sector with an estimated market share of over 95%. Samsung aims to take on the behemoth with its foundry package turnkey service.

Write to Jeong-Soo Hwang at hjs@hankyung.com
 
Jongwoo Cheon edited this article.