Seoul: Nvidia Corp.’s strategic initiative to supply 260,000 of its advanced artificial intelligence (AI) chips to South Korea is projected to open significant avenues for Samsung Electronics Co. and SK hynix Inc., industry analysts suggested on Friday. The announcement was made during Nvidia CEO Jensen Huang’s participation at the APEC CEO Summit in South Korea. The U.S. chip giant plans to collaborate with the Seoul government and key local players such as Samsung Electronics Co., SK Group, Hyundai Motor Group, and Naver Cloud Corp., to establish “AI factories” utilizing Nvidia’s Blackwell graphics processing units (GPUs).
According to Yonhap News Agency, market observers anticipate that these developments will create substantial opportunities for South Korean chipmakers Samsung and SK hynix. Nvidia’s Blackwell GPU, which integrates eight units of the advanced HBM3E memory, implies that the 260,000 GPUs designated for South Korea will necessitate approximately 2.08 million HBM units. As HBM is crucial for AI servers, its demand is escalating due to its ability to enhance data-processing speeds in data centers.
Industry officials predict that Samsung and SK hynix will fulfill nearly all of this demand, excluding U.S.-based Micron Technology Inc. SK hynix has traditionally been Nvidia’s principal supplier for HBM chips, but Samsung is emerging as a significant partner, indicating a new competitive phase between the two Korean chipmakers.
With an estimated price of around US$300 per HBM3E chip, the total HBM volume for Nvidia’s South Korean supply could exceed 900 billion won ($650 million). An industry official noted, “The GPUs will be brought into South Korea, but the high-end memory chips that power them will come from Samsung and SK hynix.”
SK hynix currently leads the global HBM market, strongly supplying Nvidia’s H100 and H200 processors. However, Samsung is perceived to be catching up after lagging behind its domestic competitor in recent years. Nvidia’s GPU supply announcement may offer Samsung the momentum needed to bolster its position before the anticipated release of the next-generation HBM4 chips, projected to enter mass production next year.
Samsung has already sent sample HBM4 chips to major clients, including Nvidia, and is engaged in discussions with Nvidia regarding HBM chip supplies. Meanwhile, SK hynix aims to further entrench its status as the world’s leading supplier, as noted by industry observers. Huang also met with SK Chairman Chey Tae-won to explore AI technology cooperation.
Data from Counterpoint Research reveals that SK hynix held 64 percent of the global HBM market share in sales during the second quarter, followed by Micron at 21 percent and Samsung Electronics at 15 percent.