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Samsung Electronics Appoints New Head of Key Business Support Office

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Samsung Electronics has appointed HK Park as the new head of its Business Support Office, the company’s central decision-making body that serves as a key coordination hub for chairman Jay Y. Lee and Samsung Group’s vast network of affiliates.

The unit, recently upgraded from a task force into a full-fledged office, functions as a strategic control tower across South Korea’s largest conglomerate, whose businesses span semiconductors, smartphones, shipbuilding, and pharmaceuticals.

Park, a former chief financial officer (CFO) at Samsung Electronics, joined the Business Support Task Force a year ago before being promoted to lead it. His appointment marks the first major leadership reshuffle since the office’s formation, following Samsung’s 2017 decision to dissolve its previous corporate nerve center after it became embroiled in a high-profile graft scandal.

Park replaces Chung Hyun-ho, who will now serve as an advisor to Chairman Jay Y. Lee. According to Samsung, Vice Chairman Chung, 65, “expressed his intention to step down from management to focus on nurturing future leaders, as Samsung’s business has been back on track.”

The company also said it has no plans to expand personnel at the Business Support Office at this time.

The leadership change underscores Samsung’s efforts to streamline its internal governance while maintaining close coordination across its many divisions — from memory chips and displays to consumer electronics — at a time of intense global competition and rapid AI-driven transformation.

AI Boom Sparks Global Shortage and Price Surge in Conventional Memory Chips

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The worldwide race to produce advanced AI chips is causing a supply crunch for more traditional memory chips used in smartphones, computers, and servers — triggering panic buying and steep price increases across the semiconductor industry. Executives and analysts say the AI frenzy has unexpectedly set off a “super cycle” in the memory market, giving long-awaited relief to manufacturers such as Samsung Electronics, SK Hynix, and Micron Technology.

As chipmakers shift production capacity toward high-bandwidth memory (HBM) — essential for powering Nvidia’s AI processors — the supply of conventional DRAM and DDR5 server memory has tightened sharply. According to Fusion Worldwide president Tobey Gonnerman, demand has surged “in a fast and furious way,” leading to double and triple ordering reminiscent of past shortages.

The shortage coincides with a replacement cycle for data centers and personal computers, alongside stronger-than-expected smartphone sales. As a result, spot prices of DRAM nearly tripled in September compared to last year, while average inventories have dropped to just eight weeks, down from 31 weeks in early 2023.

Analysts predict that non-HBM chips could soon surpass HBM in profitability if current trends continue. In the latest quarter, Samsung earned an estimated 40% margin on commodity DRAMs, compared with 60% on HBMs. Rising prices have already pushed companies like Raspberry Pi to raise consumer prices, citing memory costs that have more than doubled over the past year.

Still, experts warn against overhyping a permanent boom. TechInsights vice chair Dan Hutcheson said the current cycle may last only a year or two, with a potential industry downturn forecast for 2027. While Samsung stands to benefit most from its non-HBM dominance, investors remain cautious about its ability to close the gap with rivals SK Hynix and TSMC in next-generation AI chip technologies.

Samsung and SK Hynix Surge After OpenAI Chip Partnership Boosts AI Optimism

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Shares of Samsung Electronics and SK Hynix soared on Thursday after OpenAI announced a major partnership with the two South Korean chipmakers to support its massive Stargate artificial intelligence data centre project in the United States.

Samsung Electronics jumped 4.7%, reaching its highest level in more than four years, while SK Hynix surged 12% to an all-time high, adding a combined $37 billion in market capitalization.
The rally also lifted South Korea’s benchmark KOSPI index by more than 3%, marking a new record.

MARKET REACTION AND ANALYST INSIGHT

Analysts said the partnership could dispel earlier market fears about potential declines in high-bandwidth memory (HBM) chip prices amid rising competition.

“Such worries will be easily resolved by this strategic partnership,” wrote Jeff Kim, analyst at KB Securities, predicting a sharp rise in chip demand driven by the Stargate project.
Kim added that, since Stargate is a key U.S. government-backed initiative led by President Donald Trump, the collaboration could also positively influence trade negotiations between Washington and Seoul.

DETAILS OF THE PARTNERSHIP

The deal — part of the $500 billion Stargate project aimed at building next-generation AI infrastructure — will see OpenAI, Samsung, and SK Hynix jointly work on semiconductor procurement and the construction of two data centres in South Korea, referred to as a “Korean-style Stargate.”
Each data centre will start with a 20-megawatt capacity, and Seoul hopes the project will help position South Korea as an Asian AI hub, given that the country already ranks second globally in the number of paying ChatGPT subscribers after the United States.

WIDER IMPACT ON SAMSUNG AFFILIATES

Other Samsung affiliates also gained sharply on the news:

  • Samsung SDI rose on expectations of increased demand for advanced power systems.

  • Samsung C&T and Samsung SDS advanced after confirming new roles in AI data centre construction and infrastructure partnerships with OpenAI.

STRONGER EXPORT OUTLOOK

The AI-driven semiconductor boom has been a key factor in South Korea’s economic rebound, with exports rising in September at their fastest pace in 14 months, defying concerns about the impact of U.S. tariffs.
Seoul hopes to finalize a trade agreement with the United States by late October, following a preliminary deal reached in July that would lower tariffs on South Korean imports in exchange for a $350 billion U.S. investment package.

However, officials have said talks have stalled over concerns about foreign exchange risks and the structure of the investment commitments.