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South Korean Semiconductor Crisis: Comprehensive Analysis of Memory Semiconductor and Foundry Sectors

1. Current Status of Memory Semiconductor Sector

Recently, the semiconductor industry, which represents the South Korean economy, has faced a major crisis.
Chinese companies, such as Changxin Memory, which started in 2016 with Chinese government investment, are rapidly narrowing the technology gap.
Chinese companies have succeeded in replacing Korean-made general-purpose DRAMs and are significantly increasing their market share.
Although China’s memory semiconductor export share has fallen by 15.5 percentage points from 35.8% in two years, rapid technological entry is noticeable.

Experts assess that they are already 5 to 6 years ahead of South Korea in semiconductor design.
SK Hynix recorded its highest-ever performance thanks to the HBM boom, but Samsung Electronics failed to pass NVIDIA’s quality tests in entering the AI semiconductor field.
Differences in judgment among executives are pointed out as a cause of intensifying competition among Korean companies, and the landscape of the memory semiconductor field is likely to change significantly.

2. Current Status of Foundry (Contract Manufacturing) Sector

There is even more severe market pressure in the foundry sector.
Taiwan’s TSMC is showing overwhelming leadership, recording $90 billion in sales last year, a 45.7% operating profit margin, and a 67% market share.
Global major customers such as Apple are using TSMC as their main production partner.

Samsung Electronics announced a plan to invest 133 trillion won over 10 years six years ago, but its market share, which was 19% at the time, plummeted to less than half last year.
The foundry gap between TSMC and Samsung has widened to more than 8 times, and growth potential is seen only in some areas such as AI server demand.
Industry experts say that Samsung’s foundry competitiveness will lag in the long term because it takes a long time to restore customer trust.

Recently, Samsung Electronics has begun internal diagnosis of the system semiconductor sector, and there is analysis that a more thorough review of foundry business market share and competitiveness issues is needed soon.

3. Response and Future Outlook

The South Korean semiconductor industry is facing fierce global competition in both memory and foundry.
The market landscape is rapidly changing due to aggressive investment and technological innovation by Chinese companies and the unique competitiveness of Taiwan’s TSMC.
Domestic companies urgently need to re-examine the timing of technology development, investment strategies, and restoration of customer trust.
In particular, it is essential to establish strategies centered on key keywords such as AI semiconductors, South Korean semiconductors, memory semiconductors, foundry, and system semiconductors.

Industry experts advise that we should not be complacent with existing methods, but should respond from a long-term perspective in line with technological innovation and market changes.
It is necessary to correct the judgment errors of internal executives and make efforts to strengthen global competitiveness.

< Summary >

The South Korean semiconductor industry crisis is deepening.
Chinese companies are rapidly narrowing the technology gap in the memory semiconductor sector and expanding market share.
TSMC is showing overwhelming dominance in the foundry market, and Samsung Electronics is having difficulty restoring competitiveness.
In the future, technology innovation and customer trust recovery strategies are urgently needed, focusing on core areas such as AI semiconductors and system semiconductors.

*Source : [SBS 뉴스] 무너진 이재용의 꿈…이러다 중국한테 다 먹힌다 (풀영상) / SBS 8뉴스