Samsung back on top as biggest chipmaker

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Samsung back on top as biggest chipmaker

Samsung Electronics' office in Seocho District, southern Seoul [NEWS1]

Samsung Electronics' office in Seocho District, southern Seoul [NEWS1]

 
Samsung Electronics regained its crown as the world’s largest chipmaker in terms of revenue in the second quarter, outstripping Intel.  
 
Samsung Electronics’ semiconductor business generated $20.3 billion in sales between April and June, up 19 percent over the previous quarter, according to data released by IC Insights, a U.S. semiconductor market research firm, last week.  
 
Intel, the Santa Clara, California-based chip producer that reigned as the largest chipmaker since the fourth quarter of 2018, posted $19.3 billion in chip sales in the second quarter, up 3 percent on quarter.
 
Samsung’s return to the top position is attributed to surging prices for dynamic random access memory (DRAM) and NAND Flash memory chips, a cyclical upturn for memory chips. Intel is weaker in the memory chip sector as it focuses on manufacturing central processing units.  
 
“Samsung was previously ranked as the top semiconductor supplier through much of 2017 and 2018 when the memory market experienced its last cyclical upturn,” the IC Insights report said.  
“And, the company last enjoyed quarterly sales in excess of $20.0 billion in 2018 during the peak of the previous memory upturn.” 
 
The market tracker projected that the memory chip boom will continue through the third quarter, expanding Samsung’s lead over Intel.  
 
It forecast that semiconductor sales by Samsung will rise another 10 percent to $22.3 billion in the third quarter while those of Intel will shrink by 2.7 percent to $18.8 billion.
 
Taiwan’s TSMC came in third in the second quarter with $13.3 billion in sales, followed by another Korean chip manufacturer, SK hynix.  
 
Other players like Santa Clara, California –based Nvidia and Taiwan’s MediaTek moved up in the ranking.  
 
“Nvidia’s 14 percent second quarter increase came on the strength of continued growth of the company’s important data center and gaming segments,” IC Insights said. 
 
“Meanwhile, MediaTek’s sales increased 17% in 2Q21, continuing an impressive sales upturn driven by strong demand for 5G smartphones and consumer multimedia systems that first ramped up during the Covid-19 virus pandemic in 2020.”
 
While analysts are generally positive about the third quarter, some painted a grim prospect for DRAM prices in the fourth quarter and through next year, a projection that recently pushed down the stock prices of such memory chipmakers as Samsung Electronics and SK hynix.  
 
Analysts warned that high memory-chip inventories as a result of stockpiling will translate into lower demand starting in the final quarter of the year and into next year.
 
A slowdown in the manufacturing of cars and electronic devices -- a consequence of the global shortage of processor chips -- could also contribute to a glut of DRAMs.
 
 

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]
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