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Felicia Ray Owens at the Center of It All.

Can Samsung’s struggles become Micron’s gain?

Korean giant Samsung typically reports pre-earnings guidance shortly after the end of each quarter, and today guided for its second-quarter operating profit to fall 56% relative to last year, far below consensus.

Additionally, on the all-important question of Samsung’s high-bandwidth memory (HBM) product, Samsung didn’t give any update on shipments of its new 12-layer HBM3 product, for which investors had been hoping.

HBM is so important to the “big three” DRAM companies because it is in high demand for AI applications, and all the major DRAM companies have contracted fixed HBM prices at high margins for the current year. This is in contrast with traditional DRAM, where the price can fluctuate more frequently based on current market supply and demand.

Korean rival SK Hynix assumed the early lead in HBM, but Micron has been quickly catching up with leading technology and is rapidly increasing its HBM market share. Meanwhile, Samsung has been struggling with its technology, having been late in getting its HBM3 product qualified by Nvidia for the latest-generation AI systems.

Samsung has long been the market leader in traditional DRAM chips, while Micron has traditionally been the third-place provider with a mid-20% market share. However, if Samsung’s update — or lack thereof — is a sign that it continues to work out kinks in its technology, it could open up an opportunity for Micron to potentially grab more HBM market share above and beyond its traditional DRAM market share.

Micron’s stock is more expensive today, but it may deserve the premium

Micron operates in an oligopoly of just three total HBM providers, which means if one company struggles, the other two can massively benefit. Last quarter, Micron saw near-50% sequential growth in its HBM sales, with the volume of its 12-high HBM3E memory ramping “extremely well.” Management also noted it had already sent HBM4 samples to customers and expects volume production of HBM4 in early 2026.

Samsung also maintains it will qualify its HBM4 with Nvidia in the second half of this year. However, given the delays with its HBM3 products and the need to catch up to Micron and SK, any further delays would only open up more opportunity for Micron.