Record-breaking Performance in Q1
Samsung Electronics had its presence felt by returning to the top spot in the global semiconductor market in three years in 2021. However, there is still a long way to go. The company aspires to become the No. 1 player in the system semiconductor sector by 2030. But it faces a formidable rival, TSMC of Taiwan.
Gartner announced on April 15 (local time) that Samsung Electronics posted US$73.2 billion (90 trillion won) in semiconductor sales in 2021, surpassing Intel, which posted US$72.5 billion in sales, to become the world's No. 1 player in semiconductor sales. In terms of market shares, Samsung Electronics accounted for 12.3 percent, slightly ahead of Intel's 12.2 percent.
A spike in sales amid a boom in the memory market drove Samsung Electronics’ recapture of the top spot in the semiconductor market. According to Gartner, the memory business division of the Korean semiconductor giant logged a 33.2 percent increase in sales compared to the previous year due to a price hike.
Yet, Samsung Electronics is struggling in the non-memory sector, which is much larger than the memory market. It accounts for 70 percent of the global semiconductor market.
In the non-memory market, Taiwan's TSMC stands out. It has been dominant in the foundry business. TSMC's recently released results show its dominance in the market.
TSMC's sales in the first quarter were 491.1 billion Taiwanese dollars (about 20.76 trillion won), up 35.5 percent from the same period of 2021. Its operating profit swelled 48.7 percent to 223.8 billion Taiwanese dollars (about 9.45 trillion won). Its operating profit margin reached a whopping 45.6 percent. Its net profit hit 202.7 billion Taiwanese dollars (about 8.6 trillion won).
TSMC's record-breaking performance is in contrast with that of Samsung Electronics. Samsung estimated its total sales in the first quarter of 2022 at more 77 trillion won. Of the total, the foundry division’s sales are estimated at 7 trillion won, which is even smaller than TSMC's operating profit of over 9 trillion won and net profit of over 8 trillion won.
TSMC has a bright future. It expects its sales to grow by up to 37 percent in the second quarter of 2022 as a global semiconductor shortage shows no signs of improving. If the current situation continues, TSME’s sales in 2022 will exceed US$56.8 billion (70 trillion won) in 2021.
Samsung Electronics is also expected to enjoy growth in the foundry business. Its foundry sales are expected to exceed 30 trillion in annual sales for the first time in 2022. The foundry market environment is favorable for Samsung Electronics. According to IC Insights, a global market research company, the size of the global foundry market is expected to expand from US$87.4 billion in 2020 and US$110.1 billion in 2021 to US$132.1 billion in 2022 as the market has grown by 20 percent every year since 2020.
Meanwhile, market research firm TrendForce said TSMC accounted for 52.1 percent of the global foundry market in the fourth quarter of 2021 against Samsung Electronics' 18.3 percent.