Overtaken by Broadcom
Samsung Electronics has slipped to fourth place in global semiconductor market capitalization rankings, surpassed by U.S.-based fabless semiconductor firm Broadcom. Non-memory companies such as Nvidia and Broadcom are expanding their territories through massive investments and mergers and acquisitions (M&A).
According to the U.S. stock market on July 12 (local time), Broadcom’s market cap as of the closing price was US$367.3 billion (about 468.85 trillion won), surpassing Samsung Electronics’ market cap of about 429.22 trillion won.
The reversal in market capitalization is attributed to a surge in stock prices mainly in the non-memory (foundry, fabless) semiconductor industry due to the AI boom this year. While Samsung Electronics’ stock price rose by 30% during the year, Broadcom’s increased by 60%.
Currently, the world’s number one in the semiconductor market cap is Nvidia of the U.S., which holds a firm grip on the AI semiconductor market with a market cap of US$1.8 trillion. Taiwan’s foundry firm TSMC is in second place with a market cap of US$538.8 billion.
Samsung Electronics had claimed the top spot in the global semiconductor market cap in 2018. However, the growth and profitability of non-memory firms compared to memory firms have been attracting attention, leading to a decline in Samsung’s ranking.
In fact, leading American non-memory semiconductor firms are expanding their territories through large-scale investments and M&As. According to major foreign media outlets like CNBC, Nvidia is investing US$50 million in Recursion, a biotech company, for the development of AI models. Recursion provides pharmaceutical manufacturers with new drugs and therapies discovered and designed through AI models via the Recursion OS platform. AI is expected to bring significant changes to the pharmaceutical and biotech sectors in the future, as it can accelerate new drug development by enabling the exploration of hundreds of thousands of papers and chemical compounds.
Meanwhile, on the same day, the European Union (EU) Commissioner for Competition finally approved Broadcom’s acquisition of cloud computing company VMware. The scale of Broadcom's acquisition deal reaches US$61 billion.