In a nutshell: Samsung Electronics rode the AI hype prepare to an enormous quarterly rebound, with working revenue skyrocketing almost 933% year-over-year. And so they’re betting massive that this AI growth is simply getting began.
The tech big reported blowout Q1 2024 outcomes on Tuesday, with an working revenue of 6.61 trillion Korean gained ($4.76 billion) – up an eye-popping 932.8% in comparison with the identical interval final yr. That crushed analyst expectations of 5.94 trillion gained and was bang on their pre-release steerage from earlier this month.
The rebound was fueled by a surge in reminiscence chip costs, as AI firms scrambled for high-end semiconductors to energy their more and more advanced massive language fashions and different cutting-edge AI apps. After posting report losses in 2023 from the post-pandemic stoop, Samsung’s reminiscence enterprise swung again to a 1.91 trillion gained working revenue in Q1.
“As AI suppliers enhance, the dimensions of coaching information turns into proportionally greater, resulting in greater efficiency and information storage wants. So, we’re seeing a whole lot of incoming requests from the purchasers,” stated Samsung through the earnings name.
Total Q1 income jumped almost 13% year-over-year to 71.92 trillion gained ($52.3B), pushed by strong Galaxy S24 flagship telephone 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 income in Q2 earlier than new product launches within the second half.
“Within the second half of 2024, enterprise situations are anticipated to stay constructive with demand – primarily round generative AI – holding sturdy, regardless of continued volatility regarding macroeconomic traits and geopolitical points,” the corporate stated in an announcement.
Nonetheless, the outlook for the reminiscence biz stays good due to AI, with Samsung predicting a “constructive” setting 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 based mostly 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 peak as present 8-layer HBM chips. The key sauce is superior thermal compression non-conductive movie that lets them cram 12 stacked layers into current HBM footprints, giving AI giants immense reminiscence bandwidth to gas 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 larger compute energy.
