Samsung shifts strategy to combat Chinese DRAM surge

Samsung restructures DRAM (memory) business to tackle intensifying Chinese memory chip surge. The company is reportedly revisiting its strategy amid growing competition from Chinese memory chipmakers and contract manufacturers.

Chosun reports that Samsung facing significant competition in the DRAM business. Chinese vendors aggressively enter the areas that are unaffected by the US sanctions. The company had to rethink its strategy to combat the Chinese surge surge.

Samsung’s DS Division head is tackling these challenges. The division is preparing for a potential workforce and organizational restructuring by the year-end. DS Division could scale back production of legacy DRAM and 8-inch foundry segment.

It’s worth noting that Chinese chip makers eyeing gains in areas such as legacy chips used in automobiles, aircraft, home appliances, and consumer electronics. The Q3 performance had taken a hit from weaker-than-expected memory chip demand.

Apart from this, Samsung Foundry is also adjusting course by reassigning workers from the 8-inch foundry line at its production facility in Giheung, Gyeonggi, where utilization rates have also been significantly lowered.

At the recent earnings call, Samsung acknowledged its profitability has taken a hit due to the influx of Chinese DRAM. South Korea’s SK Hynix has also indirectly mentioned the pressures posed by increased Chinese DRAM supply.