The shares of Samsung Electronics have not performed well this year. As of last week, the company's stock price was down nearly 8% year-to-date. Investors have been concerned about the headwinds facing Samsung's chip business, which remains one of its most lucrative divisions.
Rumors that Samsung's HBM3E modules had failed NVIDIA's quality tests didn't help, since Samsung was once expected to become NVIDIA's sole supplier of these advanced memory chips in 2024. However, the shares have since surged after NVIDIA CEO Jensen Huang confirmed that Samsung's memory chips haven't failed the tests, and that they're still being evaluated.
A welcome rebound for Samsung Electronics stock
Samsung Electronics shares surged up to 3.6% in trading today, trading above 77,000 won or ~$56, making up some of the ground that the stock has lost this year. It's evident that NVIDIA CEO Jensen Huang's comments yesterday have led to this surge.
He confirmed that NVIDIA is currently working to certify Samsung's HBM3E chips, rubbishing rumors that they had failed quality tests. Samsung investors obviously didn't like the possibility of the company not being able to supply memory chips to the current leading AI chipmaker.
NVIDIA is selling a lot of AI chips and it needs a substantial amount of high-bandwidth memory modules. There are only a handful of companies that can supply those products. SK Hynix is already a part of its supply chain, and now Samsung Electronics and Micron are both trying to get in on the action.
Market analysts are of the view that Samsung's HBM3E modules should be able to pass NVIDIA's certification tests within the next two or three months. Whether that would be enough to convince foreign investors who have been dumping billions of dollars worth of Samsung Electronics stock remains to be seen.
