President Donald Trump has yet to officially take office next month. However, his policies seem to be already gaining traction ahead of his swearing-in as the 45th President of the United States. One such move comes with the U.S. urging top chipmakers to halt shipments of advanced AI chips to China; Samsung appears to be on the same page as the U.S. government on this matter, along with a few others.
Meanwhile, China isn’t sitting idly by. It’s giving Samsung’s memory business — essentially the company’s main revenue driver for some time — a run for its money. As pointed out by SamMobile, the South Korean tech giant is facing fierce competition from Chinese memory makers, such as SK Hynix, in the DRAM and NAND segments.
Chinese price wars hit Samsung’s bottom line
China-based memory makers have flooded the market, driving prices down significantly. For instance, DRAM prices have plunged by over 20% in just the past month. A DDR4 8Gb module now costs around $1.35, the lowest it’s been since September 2023.
However, it’s the NAND flash memory that’s really feeling the squeeze, with prices plummeting nearly 30% to $2.16 per 128Gb module. In fact, NAND prices have been cut by more than 50% this year alone, hitting their lowest point since 2015.
China offering memory chips at half the price of Samsung’s
What’s making matters worse is that China-based companies offer memory chips at roughly half of what Samsung charges. It’s no wonder that Samsung’s profit margins are taking a hit in this segment. To cope, the company, like its competitors, has been scaling back production to curb oversupply and stabilize prices.
However, with Chinese players ramping up their production — particularly CXMT, which has dramatically increased its wafer output — it’s hard to see this situation improving anytime soon. Samsung is now turning to next-gen products like HBM4 to diversify and weather the storm. But for now, China’s price war is putting Samsung in a real bind.
