It looks like Samsung is planning big moves in China as it desperately wants to regain its position in the global market. The South Korean tech giant has been facing several challenges, including a decline in market share across multiple business divisions and missing out on the AI boom. As a result, both co-CEOs, the late Han Jong-hee and Jun Young-Hyun, had to face difficult questions from investors regarding the companyโs slow growth. The companyโs chairman, Lee Jae-yong, has now said that executives should adopt a โdo-or-dieโ mindset.
Samsung Chairman meets Chinese President Xi Jinping
Recently, Samsungโs chairman, Lee Jae-yong, visited China on a business trip. As part of his tour, he reportedly met with Chinese President Xi Jinping. This high-profile meeting has drawn attention from industry watchers, as President Xi also met with CEOs of BMW, Mercedes-Benz, and the U.S. semiconductor firm Qualcomm. While details of the discussion remain unclear, trade, investment, and technology partnerships could be the key topics.
Samsung is aiming to expand its automotive business, and partnering with major Chinese EV companies could boost its business. That is why, during his trip, Lee also met with Xiaomi chairman Lei Jun to discuss a possible collaboration on EVs. He even met executives at BYD, Chinaโs leading EV manufacturer.
Samsung could benefit from Chinaโs AI growth
Investment firm Morgan Stanley believes Samsung is in a strong position to benefit from Chinaโs increased spending on AI technology. The company accounts for around 40% of HBMโs market share, with 80-90% of the market share among ASIC customers. It is also the sole supplier of Nvidiaโs H20 chips in China. Although Samsung could see a decline in HBM revenue in early 2025, new AI-related demand from China could help increase sales in the second half of the year.
Despite these opportunities in the Chinese market, Samsung is struggling due to U.S. trade restrictions. Samsung wanted to make AI chips for Chinese tech giant Baidu using its advanced 2nm process. However, due to these restrictions, the company has reportedly canceled its plans to secure this deal. It will be interesting to see how Samsung will tackle these trade restrictions and expand its business in China.
