South Korean market leader Samsung Electronics (SSNLF) is set to begin production of its next-generation high-bandwidth memory chips, known as HBM4, as early as next month, according to a Reuters report. The chips are expected to be supplied to Nvidia (NVDA), whose AI processors depend heavily on advanced memory. The market reacted quickly to the news. Samsung’s shares in South Korea gained nearly 2.2% in morning trading on Monday.
Claim 50% Off TipRanks Premium
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Stay ahead of the market with the latest news and analysis and maximize your portfolio's potential
Samsung is working to improve its standing in the fast-growing AI memory market. Last year, delays in high-end memory supply weighed on the company’s earnings and share price, allowing rivals to gain ground with major customers.
HBM4 Progress Draws Investor Attention
HBM chips play a key role in Nvidia’s AI accelerators, helping them process large amounts of data faster. Samsung has been trying to narrow the gap with local rival SK Hynix, which has become Nvidia’s main supplier of advanced HBM chips.
South Korea’s Korea Economic Daily reported that Samsung recently passed HBM4 qualification tests for Nvidia and Advanced Micro Devices (AMD). The report said shipments to Nvidia could begin as soon as next month. Samsung and Nvidia did not comment on the report.
What This Means for Nvidia
If Samsung begins HBM4 production as planned, Nvidia would gain another source of high-speed memory at a time when demand for AI chips remains strong. HBM4 memory is expected to be used in Nvidia’s next-generation Vera Rubin AI processors, which are in production and set for rollout this year.
Adding Samsung as a supplier could help ease pressure on overall memory supply and give Nvidia more stability as it prepares its next wave of AI platforms.
Are Nvidia Shares a Good Buy?
According to TipRanks, NVDA stock has a Strong Buy consensus rating based on 39 Buys, one Hold, and one Sell assigned in the last three months. At $263.44, the Nvidia stock price target implies a 40% upside potential.
