Samsung Electronics’ problems with Nvidia’s HBM3E memory supply contracts often make the news, but how the Korean giant is trying to compensate for these failures is not often discussed. As it turns out, Samsung is not averse to making money on chip supplies to China, as long as it is not hampered by expanding sanctions.
Image Source: Samsung Electronics
At least, there is information in open sources that last year, Samsung Electronics’ exports to China increased in monetary terms by 54% compared to 2023. According to the Financial Times, this was largely due to the desire of Samsung’s Chinese customers to buy as many chips as possible before even stronger US export restrictions came into force.
As it became known, last year Samsung sold one of the Chinese clients more than three years’ supply of logic components manufactured for him. It is assumed that we are talking about the division of Baidu, which develops chips under the Kunlun brand. The level of performance provided by accelerators based on them is not specified, so it is impossible to say for sure that Samsung violated US export restrictions. In any case, Samsung officials claim that the company complies with all US government requirements in this area, but is not ready to discuss its relations with specific clients.
Samsung is not averse to supplying its HBM memory to China. According to some sources, it is the largest supplier to China. The world’s largest manufacturer of the same HBM3E is its competitor SK hynix, but the latter’s capabilities are not enough to meet the demand from priority customers like the American Nvidia, so SK hynix does not even look towards the Chinese market.
Another matter is Samsung Electronics, which is still unable to establish mass supplies of memory for Nvidia, and Chinese customers are ready to settle for lower requirements. At least, the Kunlun Core P800 accelerators presented in February are equipped with memory manufactured by Samsung. According to rumors, the companies still had to freeze plans to expand cooperation due to the export restrictions announced by the United States in the last days of Biden’s administration. If they did not exist, Samsung would certainly agree to produce a new generation of semiconductor components for Baidu. The Korean company does not give up hope of achieving more significant concessions from the current US authorities.