Recently, there have been new developments in the Korean memory market. In January 2025, South Korean memory manufacturers SK Hynix and Samsung both saw a decline in their multi-chip package (MCP) exports, with SK Hynix's MCP exports falling by nearly 30% month-on-month, and Samsung's MCP exports falling by as much as 62.3% month-on-month, a phenomenon that has attracted widespread attention in the industry.
According to data from South Korea's alternative data platform Aicel, SK Hynix's MCP tentative export value at South Korea's main production bases in Icheon and Cheongju was about $1.29 billion in January. Although it increased by 105.7% year-on-year, it was down 29.8% compared to December 2024 and 19.3% when considering the number of working days in January, the largest decline since April 2023. Among them, South Korea's MCP exports to Taiwan performed poorly in January, with exports valued at $994 million, down 51.1% month-on-month to the lowest level since May 2024. For Samsung, the provisional export value of its MCP at its main production bases in Pyeongtaek, Yongin, Suwon, Cheonan and Asan fell sharply by 62.3% month-on-month in January.
As a key product in MCP, high-bandwidth memory (HBM) has attracted much attention in the market. It is argued that after two years of rapid growth, HBM has become increasingly sensitive to seasonal demand changes. HBM's market development is influenced by a variety of factors, including technology, market, policy, supply chain and other aspects. Technological innovation and bottlenecks affect its performance improvement and cost control, fluctuations in market demand and changes in the competitive landscape have an impact on its market size and enterprise share, policies and regulations play an important role in international trade and industrial support, and the stability and risk of the supply chain are also related to the normal operation of the HBM market. The iM Securities report predicts that SK Hynix's HBM exports will decline by more than 10% in the first quarter of 2025 compared to the fourth quarter of 2024, while DRAM shipments are expected to decline by 12% and NAND flash memory by 18% in the same period. Samsung Electronics also said in its fourth-quarter 2024 earnings conference that it expects HBM sales to decline due to geopolitical issues such as export restrictions on artificial intelligence semiconductors and demand delays due to improved product launches. Industry watchers estimate that Samsung's HBM supply in the fourth quarter of 2024 will just exceed 2 billion gigabytes, and that it may only supply about 1 billion gigabytes in the first quarter of 2025.
Figure: SK Hynix and Samsung's multi-chip package exports declined in January 2025 (Source: SK Hynix)
In addition, new manufacturing processes and architecture designs can improve HBM's performance and expand the range of applications. For example, more advanced packaging technologies can increase data transfer rates to meet the growing demands of AI and high-performance computing. However, there are bottlenecks in technology R&D, such as difficulties in improving yield and technical difficulties in integrating with other chips, which will limit HBM's capacity expansion and performance optimization, increase production costs, and hinder market development.
There are many reasons behind the decline in SK Hynix and Samsung MCP's exports, as well as the changes in the HBM market. From the perspective of seasonal factors, the consumption and production of electronic products tend to have seasonal characteristics. The beginning of the year is usually a relatively low season for the consumer electronics market, and the demand for components such as memory chips decreases, which in turn affects MCP exports.
Geopolitical factors cannot be ignored either. At present, the international trade environment is complex and volatile, and geopolitical issues such as export restrictions on artificial intelligence semiconductors have led to the suppression of HBM market demand. Trade frictions between some countries and regions have caused more obstacles to the import and export of related products, and the market expansion and sales of enterprises have been affected.
The technology product iteration cycle also comes into play. With the rapid development of science and technology, semiconductor products are frequently updated. Before a new product is introduced, there is often a wait-and-see mood in the market, and customers wait for better performing products, resulting in delays in demand for existing products, which to some extent affects HBM's sales and MCP's exports.
Although SK Hynix and Samsung's MCP export figures for January 2025 are not satisfactory, industry analysts believe that the HBM market still has great potential for growth throughout the year. According to an analysis by Shinyoung Securities, global HBM demand is expected to double in 2025 compared to 2024. However, for the first quarter, HBM's revenue is likely to decline. In the future, SK Hynix, Samsung, and other companies need to pay close attention to market dynamics, actively respond to various challenges, and grasp industry development opportunities to maintain their dominant position in the highly competitive memory market.
