The semiconductor business belonging to Samsung is experiencing a comeback wave, with the major contributor to this segment being increased RAM and NAND flash prices because of the ongoing shortage, which the Korean giant has capitalized on. However, the company isn’t stopping here because it has set lofty goals towards accumulating a healthy margin for the year, with estimates projecting that an operating profit of $69 billion or a 121 percent annual increase will be attained in 2026. To reach this figure, a new report states that Samsung will make adjustments to its strategies and production lines for its semiconductor division to achieve a 50 percent profit.
Increased 2nm GAA chip orders, and skyrocketing price of DRAM means Samsung is expected to focus on these two areas to reach its profitability goals
The focus for Samsung will be to divert its resources towards its high-margin products, which, in this case, is DRAM. According to ETNews, the Korean manufacturer is focused on its 10nm sixth-generation DRAM, also known as ‘1c,’ and if there’s higher yield, then it translates into increased profitability. Currently, the yields of this technology are estimated to be at 60 percent, but it is way short of its 80-90 percent threshold.
Currently, memory products are Samsung’s biggest cash cow, bringing in a profit margin of 50 percent due to increased demand. However, the company has also begun focusing on its 2nm GAA process, with its goal to secure a 130 percent increase in chip orders. With its yields reportedly at 50 percent, Samsung has secured a much better position for its foundry business, with a previous report even mentioning that the latter projects to obtain profitability by 2027.
Due to the booming AI demand, Samsung’s DRAM operating profit is over 50 percent, with High-Bandwidth Memory (HBM) bringing in a lower number. Based on the latest report, Samsung will shift focus on server DRAM supply to boost its margins, and once its yields stabilize for HBM, it will allocate resources to this segment too. Samsung’s new strategy is expected to remain effective until the end of the year, because the industry expects memory prices to continue rising through 2026.
News Source: ETNews
About the author: Omar Sohail is a reporter and analyst for Wccftech's mobile section, specializing in the technology and business of the mobile industry. His expertise lies in the intricate hardware supply chain, covering developments in semiconductor manufacturing, chip lithography, and camera sensor technology.
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