Samsung Electronics has reportedly secured HBM orders from NVIDIA, marking a potential upturn of the Korean giant's memory division.
Samsung's HBM Agreements With NVIDIA & AMD Will Mark a Financial Revival For Memory Division, Credits to AI
Rumors about the NVIDIA-Samsung collaboration have been revolving for a while now, and Samsung might just have gained NVIDIA's trust in its HBM products. Samsung's HBM memory has passed NVIDIA's fourth and final quality test, after which both companies have agreed to a supply contract, which could be initiated as soon as next month. Now NVIDIA has SK Hynix and Samsung as its HBM suppliers, allowing Team Green to ramp up its AI GPU production.
Samsung's inclusion into NVIDIA's panel of suppliers was imminent, primarily because the company has been unable to fulfill orders of AI GPUs such as the H100s due to the immense demand. HBM is known to be one of the crucial components, which is why NVIDIA has reached out to Samsung to diversify its supply chain. NVIDIA plans on shipping 1.5-2.0 million H100s by 2024, and achieving this aim isn't possible if NVIDIA doesn't have a wide range of suppliers.
Samsung has been in a tough spot when it comes to acquiring the trust of companies for its products. However, by gaining a massive stake in NVIDIA's HBM orders, not only will the memory division reap benefits, but the company's foundry service could also be potentially utilized for the production of AI GPUs, given that Samsung has previously proposed NVIDIA to take care of all manufacturing processes of its AI GPUs. It is expected that Samsung's market share in HBM orders could exceed 50%, surpassing the likes of SK Hynix and Micron.
Apart from NVIDIA, it was also reported that Samsung has taken responsibility for HBM production for AMD's Instinct AI GPUs, which puts the company in a comfortable position. Samsung's upcoming financial quarters could witness a significant increase in revenue, with analysts predicting that the company will dominate Q4.
Today's development is great news for Samsung's memory division, given that it has been a victim of dwindling financial quarters for quite some time now, and the AI "boom" will indeed aid in boosting revenue. However, it still depends on Samsung's approach towards HBM production and whether the company can manage huge orders, given that it now has the trust of industry leaders.
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