Memory supply strategy and HBM race
Samsung Electronics and SK hynix detailed their expanding use of multiyear memory supply agreements in back-to-back earnings calls at the end of July, as major customers seek firmer access to capacity that is expected to remain tight through 2028. Samsung said it plans to cover 60 to 70 percent of its memory production capacity through long-term agreements, typically structured as five-year deals that are reviewed annually and extended on a rolling basis. The company has completed deals with five major global data center customers and is in late-stage talks with five other large AI-related clients. Samsung said it has received roughly a quarter of the agreed deposits and that some contracts include floor prices to limit downside if memory prices fall.
UBS projected Samsung to account for 41 percent of global high-bandwidth memory bit shipments in 2027, narrowly ahead of SK hynix at 39 percent, an acceleration from its May forecast that Samsung would only reach parity next year. Samsung told analysts that HBM4 revenue in the third quarter would more than triple from the prior quarter and that HBM4 would account for more than 60 percent of its total HBM revenue in the second half of the year. SK hynix, which began mass-producing and supplying HBM4 to key customers in the second quarter, is expected to lead the market this year with a 48 percent share. Micron Technology is forecast to hold about 20 percent. Samsung shipped the first 12-high HBM4E samples to global customers on May 29, built on 1c-class DRAM and a 4-nanometer logic base die, while SK hynix began providing key customers with samples of its 12-layer HBM4E on June 18.
Consumer electronics unit swings to a loss as LG holds above 1 trillion won
Samsung's Visual Display and Digital Appliances division posted a second-quarter operating loss of 10 billion won, a reversal from a 200 billion won profit a year earlier, even as revenue rose 3 percent to 14.5 trillion won. Including the Harman audio subsidiary, the division's operating result improves to around 390 billion won on roughly 19.1 trillion won of revenue. Samsung said rising raw material and fuel costs linked to Middle East tensions, combined with so-called chipflation from memory shortages, compressed margins despite revenue support from the North and Central American World Cup and peak summer air-conditioner demand.
LG Electronics' comparable home appliance, TV and eco-solution divisions, by contrast, booked combined second-quarter revenue of 14.92 trillion won and operating profit of 1.14 trillion won, marking a second straight quarter above the 1 trillion won line. The operating profit gap between the two rivals' consumer hardware operations widened to about 1.15 trillion won in the second quarter from roughly 990 billion won in the first quarter. LG credited cost improvements, a richer high-value product mix and one-off tariff refunds, while Samsung pointed to higher component costs eroding margins and signalled restructuring of the TV division under newly appointed head Lee Won-jin.
Foldable lineup anchors premium mobile strategy in Asia
Samsung introduced the Galaxy Z Fold 8, Z Fold 8 Ultra and Z Flip 8 at its Galaxy Unpacked event in London on July 22, with the new devices forming the centrepiece of its regional premium strategy. In India, the lineup attracted more than 270,000 preorders within 72 hours, compared with about 15 days for the prior generation to reach a comparable total. Live-commerce sales of the Z Fold 8 in Korea have already surpassed double the figures recorded for the Z Fold 7, and the lineup could approach the all-time Galaxy preorder record of about 1.38 million units held by the Galaxy Note 10.
Korean preorder pricing is heavily discounted ahead of the Monday window closing: the Z Flip 8, listed at 1.93 million won, is available for as low as 780,000 won with carrier and store subsidies, while the 2.53 million won Z Fold 8 can be had for around 1.7 million won. Consumers in their teens through 30s accounted for more than half of Z8 series preorders. Samsung does not break out foldable revenue or profit, but the broader device division recorded an operating loss partly because of higher component costs. TechInsights estimated Asia-Pacific accounted for more than 81 percent of worldwide foldable shipments in the first quarter of 2026, with Huawei leading at 54.4 percent and Samsung at 22.8 percent.
AI glasses and digital health platforms broaden the device ecosystem
At the same July 22 Unpacked event, Samsung unveiled its first AI-powered eyewear developed with Google, Gentle Monster and Warby Parker, powered by Google's Gemini AI and Qualcomm's wearable chipset. The glasses, which offer real-time translation, navigation and voice-based information retrieval, are scheduled to launch this autumn. Apple is now set to enter the same market, planning to unveil its first smart glasses at WWDC in June 2027 with a commercial launch later that year, having delayed an earlier target of late 2026 to address privacy concerns.
Samsung is also rolling out a beta of its new AI-powered Samsung Health Assistant this month alongside the Galaxy S26 smartphone and updated Galaxy Watch. The assistant pulls data from Galaxy smartphones, smartwatches and the Galaxy Ring and incorporates a personalized data engine that scans devices for calendar events and travel schedules to tailor recommendations. New platform features include a Vitals tool that analyses overnight metrics, a Daily Cardio Load indicator, a Heart Health Score, Vascular Load insights and a Fitness Index. Samsung is working with the US National Institutes of Health, the Centers for Disease Control and Prevention and the Massachusetts Institute of Technology to reduce AI hallucination risks, and is also developing a separate consumer-to-physician health platform, potentially as soon as late 2026.
US foundry expansion targets 2nm and 1.4nm demand
Samsung Electronics is accelerating its semiconductor manufacturing capabilities in response to rising demand for cutting-edge 2-nanometer and 1.4-nm process nodes. The company plans to commission its first advanced contract manufacturing facility in Taylor, Texas, this year and lay groundwork for a second plant in the same region, signalling a long-term commitment to US-based advanced chip production. The expansion is intended to position Samsung as a critical foundry player as demand for leading-edge nodes intensifies across mobile devices, AI and high-performance computing, though specific financial details and timelines for the new facilities were not disclosed.
Foreign ownership falls to a 16-year low as analysts call the underweighting 'excessive'
Foreign investors' stake in Samsung Electronics has declined to 46.5 percent, its lowest level since 2010, while Samsung's weighting in the MSCI Emerging Markets Index stood at 6 percent at the end of July, down two percentage points from a June peak of 8 percent. TSMC's MSCI EM weighting was 15 percent, widening the gap to 9 percentage points, the largest since 2015. Hana Securities researcher Lee Jae-man argued that foreign investors have excessively reduced their Samsung weighting, noting that Samsung's net profit is expected to reach 2.5 times that of TSMC this year and 2.7 times next year, with an average return on equity forecast of 51 percent versus TSMC's 41 percent and a dividend yield of 3.4 percent versus TSMC's 1.3 percent. The next verifiable milestone for the memory business is Samsung's third-quarter earnings call, when analysts will look for confirmation that HBM4 revenue did triple as guided.
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