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Roula Khalaf, Editor of the FT, selects her favorite tales on this weekly publication.
Samsung Electronics reported an working revenue of Won3.9tn ($2.8bn) from its chip division within the third quarter, falling far in need of analyst estimates and behind its South Korean rival SK Hynix, because the world’s largest memory-chip maker did not take full benefit of the synthetic intelligence growth.
Working revenue within the July-to-September quarter was a lot decrease than the Won6.7tn estimate of analysts polled by Bloomberg and the Won6.45tn revenue reported within the previous quarter.
Chip earnings had been additionally a lot smaller than these of home rival SK Hynix, which reported a Won7tn working revenue final week, highlighting the widening hole of their competitiveness in superior reminiscence chips. Samsung this month issued a uncommon public apology for its weak efficiency because it has struggled to meet up with SK Hynix in excessive bandwidth reminiscence chips utilized in AI {hardware}.
Samsung has not managed to cross trade chief Nvidia’s qualification checks for superior HBM chips, however the firm mentioned on Thursday it had made “significant progress” in its efforts to win Nvidia’s approval and anticipated HBM chip gross sales to extend within the fourth quarter.
Samsung’s share worth has fallen greater than 30 per cent from its July peak on heavy overseas promoting, however the shares gained 2 per cent on Thursday morning amid hopes Samsung may regain misplaced floor in HBM chips.
The corporate expects restricted earnings development within the fourth quarter because of falling demand in cellular and pc Dram chips and a rising provide of legacy chips in China.
Analysts have expressed scepticism about Samsung’s enterprise prospects in HBM and anticipate a serious shake-up amongst its chip executives subsequent month.
“Samsung stays optimistic concerning the HBM outlook, nevertheless it gained’t be straightforward to cross the qualification take a look at and improve HBM yields,” mentioned an analyst at a overseas brokerage, referring to Samsung with the ability to produce extra of the chips with out flaws.
“It’s too early to speak about Samsung regaining HBM competitiveness,” the analyst added. “A few of its key reminiscence executives will doubtless get replaced for the weak efficiency.”
