Samsung experienced a tumultuous run in 2023, suffering from a slump in smartphone sales to lower demand for semiconductors, flash memory chips, and more. The worldwide leader in overall handset shipments also lost its top position to Apple too last year, but the Korean giant is making a strong comeback in 2024, with a new report stating that the company has reached a market capitalization of $370 billion. The last time Samsung peaked at this valuation was back in 2021, which only means that certain things are going the firm’s way.
Strong demand for AI chips and improved smartphone sales means that investors have started pouring their money into Samsung
Results posted by Korea Joongang Daily revealed that foreign investors were the primary reason behind the increase in Samsung’s $370 billion valuation, purchasing an estimated $4.2 billion in stock for 11 days straight from March 19 to April 2. However, retail investors sold around $5.04 billion in stock during the same period. This show of confidence from investors stemmed from the positive signs emanating from the semiconductor industry, and with Samsung possessing foundries that mass produce chips, flash memory, DRAM, and more, they were happy to indulge.
The company recently unveiled its next-generation HBM3E memory, which is an essential component for AI GPUs, and NVIDIA CEO Jensen Huang has stated that this high bandwidth memory is currently in its qualifying phase, with shipments expected later this year. Additionally, Samsung has plans to launch the Mach-1, its own AI accelerator, by 2025 and take on NVIDIA while supplying the latter with GDDR7 VRAM chips for the upcoming RTX 5000 series of gaming GPUs.
These factors and more are why analysts estimate that Samsung’s revenue for the first quarter will be $61.08 billion, with the figure being 14 percent higher compared to the same period last year. The company’s operating profit could reach $4.35 billion, making it a mammoth 711 percent higher compared to the same period. Samsung also intends to lower its expenditure further, as it will reportedly continue to adopt a dual-chipset launch approach for the Galaxy S25 series in 2025 as it did with the Galaxy S24 lineup by using the Exynos 2500 and Snapdragon 8 Gen 4.
By proceeding with a Snapdragon 8 Gen 2-only launch with the Galaxy S23 range, Samsung racked up a $9 billion bill for chipset purchases alone in 2023, so its current strategy is a thoughtful approach to reduce unnecessary costs and improve its finances going forth.
News Source: Korea Joongang Daily