Samsung Semiconductor's profit is 50%, and three reasons lead to the global market**.
TSMC is the world's largest semiconductor foundry, accounting for more than 50% of the world's revenue share, while Samsung only occupies about 15% of the revenue share, and has an irreplaceable position in the world market.
The reason why TSMC's market position is becoming more and more stable is mainly because its processing technology is indeed very advanced, so it has won the favor of major customers around the world.
TSMC's big mouth eats meat, and Samsung can only eat the remaining leftovers, but even if it eats leftovers, Samsung has also encountered a huge challenge, due to the downward cycle of the chip industry, resulting in a sharp decline in Samsung Semiconductor's operating profits.
A few days ago, South Korea ** reported that Samsung's device solutions division is responsible for operating Samsung's foundry, LSI system and memory division, and it is expected that the operating profit in 2023 will reach 13About 1 trillion won.
If this result is realized, the annual operating profit of Samsung's semiconductor business in 2023 will be about half of the analysts' 26 trillion won, which is expected to decline by 50%.
There are three main reasons for the sharp decline in Samsung's operating profit, which directly affects the market position of the industry leader.
The first is that the wafer foundry business is not as good as TSMC, although Samsung took the lead in debuting the 7NMEuv process, and now leads TSMC to announce the mass production of the 3nmGAA process, but there has been a lack of major customers in the wafer foundry market.
We are familiar with Apple, AMD, NVIDIA, MediaTek and other chip companies, but they still favor TSMC's process foundry, because although Samsung is the first in mass production in technology, its stability is actually very poor.
Taking Qualcomm as an example, the first-generation Snapdragon 8 uses Samsung's 4nm process, and the power consumption performance is not ideal, Qualcomm Snapdragon 8+ After switching to TSMC's 4nm process, the energy efficiency of CPU and GPU has increased by up to 30%, and the gap is obvious.
Samsung's process level is not as good as TSMC, resulting in the direct loss of Qualcomm, a major customer, in the second half of 2022, so the performance of Samsung's semiconductor business will decline significantly in 2023.
The second is the weak memory market, which includes Samsung's memory division, but due to the adjustment of customer inventory and the reduction in demand for chips in data centers, PCs and mobile devices, the downward cycle directly led to a sharp decline in memory**.
On the other hand, Changjiang's domestic memory and memory manufacturers have already mass-produced, and in April 2022, they officially launched Universal UFS31 flash memory, some time ago it completed the production of 232 layers of 3dnand flash memory, far ahead of Samsung, Micron and other companies.
The rise of home memory storage has led to a sharp decline in the revenue of Samsung's memory semiconductor business and other companies, and it has to announce layoffs, which is another major reason why Samsung Semiconductor's operating profit will be halved.
The last reason is that Samsung may stop using ExynosSoc in flagship phones, and there is news that Samsung will launch the Exynos2300 chip, but the subsequent flagship models of the Galaxy S series will not use the chip.
In recent years, Samsung's Exynos chips have been produced and sold by Samsung itself, Samsung is the largest customer of mobile phone chips, but because the overall performance of the latest generation of Exynos2200 chips is far inferior to Qualcomm's solutions launched at the same time, so that Samsung itself is not optimistic about its own chips.
It is for the above three reasons that Samsung Semiconductor's operating profit may be halved. If Samsung Semiconductor does not adjust in time and improve its competitiveness, the future will be even more difficult!What are your thoughts on this?