Samsung could displace Intel as the world’s biggest chip company in 2017

Samsung logoIntel has been the world's biggest chipmaker by revenue since January of 1993, when sales of its 386 and 486 processors helped it surpass Japanese companies like NEC and Toshiba. The release of the first Pentium CPU later that year and the proliferation of Windows 95 and 98-powered PCs over the next decade helped keep Intel on top. The company continues to grow today—revenue from chips for PCs, servers, and Internet of Things devices is all still increasing year-over-year. But a new report by IC Insights suggests that Intel might not be at the top of the heap anymore.

That's because demand for DRAM and NAND flash memory are both growing at double-digit rates, and Samsung in particular is raking in revenue. Assuming that both companies perform as expected in the second quarter of 2017, Samsung's semiconductor business could pull in $14.6 billion in revenue for the quarter, compared to $14.4 billion for Intel. Even if Samsung can't pass Intel in the second quarter, it seems likely to happen soon, given that Samsung's chip business is one of the brightest spots on its balance sheet—in Q1, revenue was up over 40 percent year-over-year.

Samsung could displace Intel as the world’s biggest chip company in 2017

Samsung's positioning is strengthening not just because of increased demand for RAM and flash memory, but because an ongoing NAND shortage is keeping prices high. Analysts blame a rocky transition from 2D to 3D NAND, increased demand from Chinese smartphone manufacturers, and the increasing popularity of SSDs as factors in the shortage.

On top of the RAM business, Samsung also says it's seeing solid demand for 14nm SoCs, image sensors, and other smartphone chips. The company expects its new 10nm process to keep the business growing. Samsung manufactures its own Exynos SoCs as well as some of Qualcomm's Snapdragon chips and some of the A-series chips Apple uses across its iPhone, iPad, iPod, and Apple TV lineups.

Source: Ars Technica

Tags: Samsung

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