It's been a tough few years for Samsung. The company is facing intense competition in the memory market, its foundry has been relentlessly burning cash all while it has to contend with an increasingly volatile geopolitical situation.
Shareholders haven't been that happy because the stock has consistently declined, even hitting a 4-year low just a couple of months back. Samsung has apologized to its shareholders for the dismal performance and has promised new mergers and acquisitions to reignite growth.
Shareholders question the lack of major mergers and acquisitions
Han Jong-hee, who is the CEO of Samsung, admitted during Samsung's 56th annual shareholders meeting today that the company didn't effectively respond to the changing AI semiconductor market last year and it couldn't elevate market competitiveness in products like phones, TVs, and home appliances.
He added that Samsung will seek growth engines in robotics, medical technology, and next-generation semiconductor markets, saying that the company will “actively pursue more meaningful M&A opportunities.” Shareholders have repeatedly called out the company for its lack of large mergers and acquisitions, and it's a complaint they're sticking with.
Samsung's profits took a huge hit last year as DRAM prices declined, HBM chip sales didn't quite take off as much as it would hoped, and demand fell for enterprise SSDs in addition to billions in losses by its foundry business. Meanwhile SK Hynix has fully capitalized on the HBM opportunity with Samsung now struggling to catch up to its cross-town rival.
To assure shareholders that there won't be a repeat of what happened last year, the vice chairman and head of Samsung Electronics' Device Solutions division Jun Young promised that “In HBM4 and customized HBM markets, we’ll ensure that our missteps with HBM3 last year will not be repeated.” SK Hynix is anticipating that, and it has already shipped prototypes of HBM4 to clients for testing six months ahead of schedule.
Shareholders also drew the executives' attention towards the share price that's been moving sideways for a long time now, compared to SK Hynix, that's up more than 20%. Han apologized for not meeting shareholder expectations, adding that Samsung is fully committed to sparing “no effort in making necessary changes to achieve this goal.”
