In a nutshell: Samsung Electronics rode the AI hype practice to an enormous quarterly rebound, with working revenue skyrocketing practically 933% year-over-year. They usually’re betting huge that this AI increase is simply getting began.
The tech big reported blowout Q1 2024 outcomes on Tuesday, with an working revenue of 6.61 trillion Korean received ($4.76 billion) – up an eye-popping 932.8% in comparison with the identical interval final 12 months. That crushed analyst expectations of 5.94 trillion received and was bang on their pre-release steering from earlier this month.
The rebound was fueled by a surge in reminiscence chip costs, as AI corporations scrambled for high-end semiconductors to energy their more and more complicated massive language fashions and different cutting-edge AI apps. After posting report losses in 2023 from the post-pandemic hunch, Samsung’s reminiscence enterprise swung again to a 1.91 trillion received working revenue in Q1.
“As AI suppliers enhance, the dimensions of coaching information turns into proportionally larger, resulting in increased efficiency and information storage wants. So, we’re seeing a number of incoming requests from the purchasers,” stated Samsung through the earnings name.
Total Q1 income jumped practically 13% year-over-year to 71.92 trillion received ($52.3B), pushed by stable Galaxy S24 flagship cellphone gross sales and people high-flying reminiscence revenues.
However the path forward is not all roses. Samsung warned of escalating geopolitical dangers, continued provide chain value pressures, and barely decrease anticipated earnings in Q2 earlier than new product launches within the second half.
“Within the second half of 2024, enterprise situations are anticipated to stay optimistic with demand – primarily round generative AI – holding sturdy, regardless of continued volatility referring to macroeconomic traits and geopolitical points,” the corporate stated in an announcement.
Nonetheless, the outlook for the reminiscence biz stays good because of AI, with Samsung predicting a “optimistic” atmosphere within the latter half of 2024 as generative AI adoption accelerates. It is also going full throttle on increasing high-end chip capability, with plans to mass produce superior HBM3E and 128GB DDR5 chips primarily based on 1b nanometer course of tech this quarter.
These upcoming HBM3E 12H chips will supply blistering 1,280 GB/s bandwidth and an unprecedented 36GB capability – all whereas sustaining the identical bundle top as present 8-layer HBM chips. The key sauce is superior thermal compression non-conductive movie that lets them cram 12 stacked layers into present HBM footprints, giving AI giants immense reminiscence bandwidth to gasoline their data-hungry fashions.
Past ramping bleeding-edge chip manufacturing, Samsung is charging forward with next-gen tech like 3nm and 2nm course of nodes to remain forward of the curve. It kicked off manufacturing of 3nm chips in 2022 and goals to begin cranking out 2nm chips by 2025 – which ought to assist feed the AI business’s insatiable urge for food for higher compute energy.
