Semiconductor Market Overview
Samsung Electronics Co. displayed a CXL memory module at the Semiconductor Exhibition (SEDEX) in Seoul, South Korea, on October 23, 2024.
The semiconductor sector has experienced stock increases since the beginning of the year, primarily attributed to demand for memory chips related to artificial intelligence (AI).
Key Company Performance
- SK Hynix (South Korea): Shares rose 11.5% year-to-date.
- Samsung Electronics (South Korea): Shares rose 15.9% year-to-date.
- Micron Technology (USA): Shares rose 16.3% year-to-date.
AI Demand and Memory Shortage
Memory components are critical for training and operating AI models developed by companies such as Nvidia and AMD. Significant investment by technology firms in AI chips and data center infrastructure has led to a shortage of memory supply.
Dynamic random-access memory (DRAM), specifically utilized in AI data centers, recorded a substantial price increase in 2025. Counterpoint Research projects an additional 40% rise in memory prices through the second quarter of 2026.
Market Analysis
Ben Barringer, head of technology research at Quilter Cheviot, noted that the recent growth in the semiconductor market has been largely driven by the memory segment rather than logic chips. He identified high demand from AI workloads and a constrained supply, particularly of high-bandwidth memory (HBM), as key factors.
Samsung, SK Hynix, and Micron are positioned to potentially increase pricing for their memory chips due to ongoing demand. Investor sentiment is positive in anticipation of upcoming fourth-quarter earnings reports.
Earnings Projections
- Samsung is projected to report a 140% increase in fourth-quarter operating profit, according to LSEG estimates.
- Micron's earnings per share are anticipated to rise by over 400% year-on-year in the December quarter.