Samsung Electronics projected that in the second half, the spread of artificial intelligence (AI) will keep memory demand strong, deepening supply shortages of DRAM and NAND flash. The analysis is that growing demand for AI servers and high bandwidth memory (HBM) will offset the slowdown in the mobile and PC markets.
Kim Jae-jun, executive vice president and head of strategy and marketing for the memory business at Samsung Electronics, said on a conference call after the second-quarter earnings release on the 30th, "In the second quarter, the memory market showed strong demand for both DRAM and NAND on the back of the spread of AI applications," and "As investment in AI data centers expanded, additional supply requests continued, centered on major hyperscalers."
Samsung Electronics said it recorded all-time-high bit shipments for both DRAM and NAND as it expanded production and sales centered on server products to meet AI demand. The share of server products also reached a record high level.
The HBM business also delivered results. Samsung Electronics said it strengthened its technological competitiveness by expanding supply of next-generation HBM4 while shipping HBM4E samples to major customers for the first time in the industry.
Second-quarter DRAM bit shipments increased by the low 10% range from the previous quarter, beating company guidance, and NAND bit shipments rose by the low single digits, in line with guidance. The average selling price (ASP) rose by the mid-40% range for DRAM and the high-60% range for NAND from the previous quarter.
Samsung Electronics expects strong memory demand to continue in the second half as AI infrastructure investment persists. Demand is growing not only for AI servers but also for general servers, and while the mobile and PC markets are slowing somewhat due to price increases, the company said rising demand for server DRAM, SSDs, and HBM is more than offsetting that.
Kim said, "Despite efforts to ramp up production, demand is growing faster," and "We expect the supply shortage relative to demand to widen further next year."
Samsung Electronics plans to optimize its product mix in response, taking into account customer demand and inventory levels. For the third quarter, it projected bit shipments to increase by the mid-single digits for DRAM and the high single digits for NAND from the previous quarter. The company said it will maintain market leadership based on product competitiveness centered on AI memory.