Samsung Semiconductor Revenue Market Share Dips by 40% in 2 Years

Samsung is facing a significant plunge in one of its biggest revenue-driving segments. According to Stocklytics.com, Samsung’s semiconductor market share dwindled by about 40% in the last 2 years. The firm’s worldwide market share in the semiconductor industry was 7.5% in 2023, down from 12.3% in 2021.

The site’s financial analyst, Edith Reads, comments:

Samsung faces challenges aligning with the changes happening in the semiconductor industry worldwide, where supply and demand conditions constantly shift. Factors such as a decline in the memory sector and decreased performance in the smartphone market have significantly impacted it’s situation. However, the main concern lies in new competitors encroaching on the tech giant’s market share. The firm hopes to begin supplying advanced memory chips for US semiconductor giant Nvidia’s graphics processing units soon. This will boost its push to regain its advantage in the semiconductor field.

Stocklytics Financial Analyst, Edith Reads

The Overall Semiconductor Market

The global semiconductor revenue reached $533 billion, an 11.1 % slump from 2022. Out of the total, Samsung’s semiconductor revenue accounted for 7.5% of the market share, raking in roughly $39.9 billion, a sharp decline of over 37.5 % from 2022’s $63.8 billion.

While Samsung may have maintained a lead in the semiconductor revenue throughout the years, it was nudged off the top position by Intel in 2023. Intel retook the market leader position within the global semiconductor industry with a market share of 9.1%, with Samsung ranking second among vendors.

Intel also led in revenues, posting $48 billion; however, this was still a significant drop of 16.7% from its 2022 earnings. Qualcomm followed Samsung in the third position with $29.015 billion in 2023. The American multinational corporation’s market share stood at 5.4%. 

Broadcom comes in close fourth with $25 billion in revenue, totaling 4.8% of the market share. And following Broadcom was Nvidia (4.5%), which drew attention for making it the top 5 list in semiconductor revenue for the first time. 

The company grew its earnings by a significant 56.4 %, a huge leap from its 12th position in 2022. Nvidia also grossed $23.98 billion in 2023 earnings, underpinned by its advances in the AI chip market.

STMicro Electronics also made considerable improvement alongside Nvidia, securing the 8th spot with a revenue increase of 7.7%. Its growing persistence in the automotive segment significantly contributes to its augmented sales.

Why did Samsung’s Semiconductor Revenue Fall Considerably?

Samsung is known mainly for its memory chips for PCs, smartphones, and servers. However, the memory chip sales dwindled considerably, eating into its grip on the semiconductor market. 

Memory chip sales experienced a weaker market in 2023, given all the excess inventory demand for the chips in the previous months and the reduced demand for smart devices like laptops and smartphones. Generally, memory chip revenues fell drastically, with 37% in 2023.

The non-memory chip revenue declined by a marginal 3%; hence, companies dealing with them posted better returns. With the demand for these chips surging, the South Korean firm has long aimed to surpass TSMC as the leader in non-memory chips. 

Analysts reckon that the demand for AI across all major applications will drive recovery in the semiconductor sales market in 2024. Samsung must, therefore, refocus its attention on non-memory chips to reclaim its position as the top semiconductor seller.