Competition between Samsung Electronics and SK hynix over leadership in the market for seventh-generation high bandwidth memory (HBM) products, HBM4E, is heating up. With expectations that Google will be the second-largest source of demand in the HBM market after Nvidia, reports say Google plans to skip sixth-generation HBM (HBM4) for its next-generation artificial intelligence (AI) chips and move straight to HBM4E, spurring Samsung Electronics and SK hynix to move quickly to secure early market share.
◇ "Google, the next big buyer in the HBM market after Nvidia"
According to the industry on the 19th, Google is expected to account for more than 30% of the HBM market this year. That would make it the second-largest share after Nvidia, which takes more than half of HBM demand. As Google begins mass production of its in-house AI chip series, the tensor processing unit (TPU), its HBM orders have risen sharply. Google is said to be equipping fifth-generation HBM (HBM3E) in the seventh-generation TPU "Ironwood" and the eighth-generation TPU, and to adopt HBM4E starting with the next generation.
Chae Min-suk, an analyst at Korea Investment & Securities Co., said, "This year, the three DRAM companies' total HBM supply will be around 37 billion gigabits (Gb), with more than 30% related to Google's TPU," and added, "That is the second-largest demand after Nvidia, and this year supply will be concentrated on the seventh- and eighth-generation TPUs."
With reports that Google plans to skip HBM4 for TPUs after the eighth generation and move straight to HBM4E, Samsung Electronics and SK hynix are tightening their timelines for HBM4E development. Samsung Electronics and SK hynix plan to finish early development by the first half of this year, conduct internal testing, and supply HBM4E samples to customers in the second half.
◇ Samsung Electronics and SK hynix to clash in the HBM4E market
Samsung Electronics was the first to mass-produce and ship HBM4 to be used in Nvidia's next-generation AI chip "Rubin," and is said to be confident in the HBM4E market as well. Having preemptively applied a 10-nanometer-class sixth-generation (1c) DRAM process to HBM4, Samsung aims to get ahead of SK hynix and Micron, which are mass-producing HBM4 using a 10-nanometer-class fifth-generation (1b) DRAM process, and seize the market. In addition, because it has internalized foundry (contract semiconductor manufacturing) technology and packaging capabilities for the logic die that serves as HBM's brain, it plans to respond quickly to customer needs and accelerate supply.
SK hynix plans to focus on stability and secure real gains in the next-generation HBM market. It will use the mature 1b DRAM process for HBM3E and HBM4 to boost profitability, and maximize 1c DRAM Production yield to go all-in on the HBM4E market. SK hynix began mass production on the 1c DRAM process in the first half of last year to enhance its technology, but considering stability and profitability in HBM mass production, it is manufacturing HBM4 using 1b DRAM, whose process Production yield is approaching the high-90% range.
A semiconductor industry official said, "SK hynix has a larger pre-committed volume with Nvidia than Samsung Electronics, so to deliver on time and maximize profitability, it has no choice but to opt for a stable process," and added, "SK hynix will also push 1c DRAM Production yield to the maximum and use it starting with HBM4E."
◇ SK hynix holds the edge for now; Samsung Electronics could expand share in a long game
Performance comparisons of HBM are also key. Samsung Electronics and SK hynix are applying different technologies to the HBM4 they are currently supplying to Nvidia. The target specifications are the same, but the DRAM processes and logic dies differ. Both matched Nvidia's specified operating speed of 11.7 Gbps (gigabits per second), but peak performance varies. Samsung Electronics uses a DRAM one generation ahead of SK hynix and a cutting-edge process for the logic die, reaching a maximum performance of 13 Gbps.
Of course, Samsung Electronics' use of a more advanced process does not guarantee an absolute edge. In mass production, Samsung's 1c DRAM is harder to produce in volumes comparable to the previous-generation 1b DRAM. SK hynix's main production process is 1b DRAM, giving it the strength to supply large volumes stably. For now, SK hynix, which has firmly established its footing in the HBM market, is more likely to be the main supplier.
But the picture changes in a prolonged contest. If Samsung Electronics stabilizes the Production yield of 1c DRAM and can supply at scale, its share in the next-generation HBM market will grow. And because the two companies' HBM4 peak performance differs, Samsung Electronics' products are likely to be adopted first in Nvidia's high-end products that use HBM4.