How Samsung fell behind in the AI boom leading to a $126 billion wipeout
Summary
But the South Korea electronics giant has now fallen behind its long-time rival SK Hynix in next-generation chips that have been key component for AI silicon leader Nvidia . Samsungs profit has plunged, around $126 billion has been wiped off its market value, according to data from S&P Capital IQ, and an executive issued a rare public apology about the companys recent financial performance. "HBM has been a very niche product ... for a long time and Samsung has not focused its resources on its development," Kazunori Ito, director of equity research at Morningstar, told CNBC by email. "Due to the difficulty of the technology involved in stacking DRAMs and the small size of the addressable market, it was believed that the high development costs were not justified." The company aggressively launched HBM chips which were approved for use in Nvidia architecture and, in the process, the South Korean firm established a close relationship with the U.S. giant.