In Hot Pursuit of Samsung
SK hynix’s global DRAM market share crossed 30 percent in the second quarter of this year as a boom in generative artificial intelligence (AI) has fueled demand for high-bandwidth memory (HBM). Its gap with market leader Samsung Electronics has reached its narrowest point in a decade.
According to market research firm Omdia on Sept. 3, global DRAM sales totaled US$10.7 billion in the second quarter of this year, down 57 percent year on year, but up 15 percent from the first quarter.
By vendor, first-place Samsung Electronics racked up DRAM sales of US$4.1 billion, up just 3 percent from the previous quarter. Its market share fell by 4.6 percentage points to 38.2 percent from 42.8 percent in the first quarter. SK hynix’s second-quarter DRAM sales grew by a whopping 49 percent to US$3.4 billion. Market share was 31.9 percent, up 7.2 percentage points from 24.7 percent in the previous quarter.
Therefore, SK hynix reclaimed the number two spot from U.S. chipmaker Micron with a 25.0 percent share. Its market share gap with Samsung Electronics shrank from 18.1 percentage points in the first quarter to 6.3 percentage points in the second quarter.
The gap between the two companies’ DRAM shares narrowed to within 10 percentage points. It had rarely happened. “The gap between the two chipmakers is at a 10-year low,” OMDIA said.
Samsung’s annual market share stayed in the 30 percent range for the last time in 2013 as it hit 36.2 percent. SK hynix, on the other hand, has never had an annual market share of more than 30 percent in the last 10 years. Since then, Samsung has consistently kept its market share in the low-to-mid 40s and SK hynix in the mid-to-high 20s.
SK hynix slipped to third place in the first quarter of this year but rebounded in the second quarter largely thanks to an AI craze. This is because HBM goes into graphics processing units (GPUs) used for data processing in the AI field such as ChatGPT. “Sales of HBMs and high-capacity products for servers with 128 gigabytes (GB) or more were strong as AI demand was in full swing,” Omdia said. “The DRAM price decline has slowed due to the expansion of premium DRAM.”
In addition, strong momentum in AI demand is expected to take the initiative in bringing changes to the DRAM market, according to Omdia. In particular, Omdia forecasts that demand for HBM expected to grow more than 50 percent at the start of the year, will grow more than 100 percent this year and next.
As HBM is seen as a way out of the current semiconductor market recession, competition is also heating up between Samsung Electronics and SK hynix. SK hynix announced on Aug. 21 that it completed the development of HBM3E and began shipping HBM3E samples to Nvidia for performance verification. HBM3E is a fifth-generation product following a fourth-generation product (HBM3) which has the highest specification in the market today. Previously, SK hynix developed the world’s first HBM3 in 2021 and successfully mass-produced it in 2022.
SK hynix is one step ahead of Samsung Electronics in the race of HBM development. The Wall Street Journal (WSJ) recently carried a story about SK hynix’s HBM business, saying, “SK hynix bet more aggressively on HBM than its rivals a decade ago, emerging as one of the early winners in the rise of AI applications.”
Samsung is stepping up its efforts to overtake SK hynix. Some observers believe that SK hynix’s HBM3 monopoly will be shaken by Samsung’s supply of HBM3 to Nvidia starting from the fourth quarter.
On Sept. 1, Samsung Electronics announced that it has developed the industry’s first 12-nm 32 gigabit (Gb) DDR5 DRAM, which is expected to help the chipmaker boost its HBM production capacity. This is because the 32 Gb DDR5 memory can be manufactured without a through-silicon via (TSV) connection, which is a key component for producing HBM. This means that the chipmaker can concentrate all TSV process equipment on HBM production.
Samsung Electronics plans to mass produce the 12-nm 32 Gb DDR5 DRAM within this year. “With this 12-nm 32 Gb DRAM we have secured a solution that can create 1 TB modules,” said Hwang Sang-jun, vice president of DRAM development at the memory business division at Samsung Electronics. “Samsung Electronics will continue to overcome the limits of memory technology with differentiated processes and design technologies.”