Samsung is now the world’s biggest chipmaker

Image: Samsung

Intel has been the dominant company in chip manufacturing for literally decades, but in 2017 it ceded its crown to Samsung, as evidenced by the two companies’ annual financial reports. First noted by Bloomberg, the change of leadership was signalled by Intel’s $62.8 billion in annual revenue being surpassed by the $69.1 billion generated by Samsung’s semiconductor division. It’s not a straightforward comparison to make, since Intel’s focus is on x86 processors, where it remains the leader by a great distance, and Samsung’s strength is in producing memory and flash storage — but in monetary terms, the latter business is now bigger.

Beyond the financials, Samsung’s memory business also looks to be far more important and fundamental to the future of technology than Intel’s traditional CPUs. These days, you’ll struggle to find a smartphone or tablet without Samsung RAM inside it, and the company also commands more than a third of the solid state drive storage market. In its latest quarterly report, Samsung anticipates growing “demand for high-density memory products for cloud servers and for chipsets required for automotive electronics and AI.” So not only is Samsung omnipresent in the devices we buy today, it’s ideally positioned to capitalize on the hardware and services that are to come.

For a better sense of the scale of Samsung’s chip production business, consider that this company is also among the leading producers of TVs, every sort of home appliance, smartphone displays, and, lest we forget, it’s the world’s most prolific smartphone vendor too. And yet, the biggest boost to its fourth quarter earnings was “driven by the components business, with the largest contribution coming from the Memory business that manufactures DRAM and NAND.” Memory prices have more than doubled over the past year, as demand continues to grow, and that has helped Samsung’s bumper year of revenue. The near-term future looks set to only extend this trend.

Comments

But I thought the Note 7 was going to destroy them?

It destroyed the chips on the Note 7 itself, and the company’s reputation for a couple of quarters, maybe. But Samsung pumps out new flagships so fast people quickly forget that one model they majorly fucked up.

I have a Note 5 and never doubted they’d get their shit together in time for my next upgrade. Looking forward to the Note 9 by the end of the year…

and the company’s reputation for a couple of quarters, maybe

Even that didn’t happen. The S7 just moved into the void left by the Note 7 and effortlessly crushed (in sales) the Pixel line that the tech press were rooting for.

Aren’t phones a separate division from the semiconductor side? Considering everything that Samsung makes it would be hard for one section to bring the whole lot down.

It is indeed a completely different division.

different "division" yes, but the chips and phones are all part of the same "company" (Samsung Electronics Ltd.) as correctly stated in the article.

Doesn’t seem to be the case with LG. They’re also super diversified, but their phone division is a huge drag on the rest of the corp.

its only a drag because LG want to keep it operational and they are using equity from other divisions to prop it up. However thats a choice they are making, it doesnt mean that the mobile part is causing negative effects directly to other parts of the business…also the biggest issues with LGs mobile business is stupid decisions like making a POLED screen that is a bit shit really. If your making OLED it needs to be on par or better than SAMOLED.

thats the reason for dividing…it may look like one sector is doing badly but it also means it doesnt drag the whole operation down. It is an easy way for samsung to sell off that part if it wanted to. If a part is sold off it is also easier to split off from the rest of the organisation.

However all sectors fall under the main umbrella company, Samsung Electronics Ltd

semiconductor side made 10 billion dollars in profit in one quarter… price gouging with memory

there is a reason for the gpu shortage, and the main reason is the fact that memory prices have doubled in the last year, second reason is mining, as without the high memory prices more gpu’s would have been made to compensate

You’re probably right and I think if they continued regulators may have stepped in and started investigating their dealings

The gpu shortage is because of cryptocurrencies.

I hope they scale up their RAM production levels, because DDR4 doubled in price in less than two years, and nowadays it’s just too ridiculously pricey.

I bet they won’t. It’s a feature not a bug. Lol

that would solve nothing as its not in short supply at all, theres a shit load of DDR4 for sale, its just 2-3x as expensive because Samsung and Hynix decided ram should be 2-3x the price. Its called price fixing, which they do all the time as it brings in many many billions of dollars with a minuscule fine.

Back when I started out with PCs in the early 90s, a 1MB RAM chip was £30, it went up to £38 and above due to a "fire at a factory in Taiwan" which I believe was a coup as they also said there was only one memory manufacturer on the planet at that time (lies). Same thing going on now, obviously the manufacturing price is vastly reduced over time and with increased quantity but still they put it up.

Eh, Yes Samsung made more in revenue, but really, it’s down to literally stamping out memory chips, which are not that complex to fab. Intel’s products are much more complex to build, on top of having a range of chips of different complexity (including memory) flowing through their fabs at any given time. Not that Samsung can’t fab SoCs/CPUs; they make their own phone chips. But aside from revenue, this is a bit like saying VW was the biggest car maker because they stamped out so many VW Beetles for 50 years, whereas other makes had a more diverse lineup.

So you judge ‘biggest’ in terms of how complicated their products are? I mean you can argue that you more impressed by Intel, but that doesn’t make them bigger.

Also, if making memory is so easy, why is Samsung dominating without any real competition?

poor Microsoft, they abandoned the smartphone business for bad direction coming from Satya Nadella, the PC market is shrinking and Windows ARM is going to have slow growth, God bless Microsoft’s employees, they will need a Miracle to increase consumers interest in PCs in the next decade

Nadella didn’t bring the bad smartphone direction to Microsoft…he actually inherited it from the previous CEO Steve Ballmer. Nadella tried to fix the mistakes made by Ballmer the best he could, but was unable to, so he did the smart thing and pulled out of the smartphone market and killed Windows Phone. Ballmer wasn’t a tech visionary, he was just a business guy, and that reflected on Microsoft itself as well. Now Microsoft is the new IBM and will continue to be for the rest of its existence.

Nadella was in charge of Nokia X which was a good plan for selling Nokia handsets with Android, unfortunately he did pretty bad execution of this and only sold starter devices with poor specs that didn’t attract carriers, but if Microsoft would have launched Nokia X on flagship, then it would have changed the history of the company since Windows Mobile would be replaced with Android with a Microsoft Android appstore, this would have attracted carriers and OEMs into this new fresh Android fork running on beautiful Nokia hardware

whatever you are smoking must be really good

Amazon did really well with the Fire Phone.

While it would be easier to port apps from the Google Play Store to a Microsoft Android appstore it is hard to say it would be adopted. I remember not being able to get the Bank of America app for my Mom’s Fire Phone. It was available for FireOS tablets, but I’m not sure how often it is updated. Then there would be the same YouTube problem that Microsoft already had.

What does this have to do with Microsoft? Windows runs on both Intel and Arm chips.

Besides, the article is about memory chips.

Why is anyone shocked? the cost of RAM and NAND was astronomical in 2017. 2016 you could get 32 gigs of DDR4 3000mhz for around $200-250. In 2017 the price soared to over $400 and is still hovering around $360 at the lowest today.

View All Comments
Back to top ↑