Samsung Electronics' stock price soars to a historic high! Report: The company plans to significantly raise the price of its HBM4 chips by 30%

Driven by the tight supply of artificial intelligence memory, Samsung Electronics' stock price soared to a historic high on Thursday. This came after South Korean media reported that the chip manufacturer is negotiating prices for the latest generation of AI memory chips, HBM4, with quotes up to 30% higher than the previous generation products.

According to South Korean media outlet Chosun Ilbo, Samsung plans to price HBM4 at around $700 per chip, a price level significantly higher than the mid-range price of $500 set by competitor SK Hynix for Nvidia last August. This pricing strategy highlights that the supply-demand imbalance in the AI memory market is continuing to intensify.

The shortage of memory chips is driving performance growth for Samsung and SK Hynix, contributing to a 32% rise in South Korea's benchmark Kospi index so far this year, making it the best-performing stock market globally. On Thursday, Samsung's stock price rose by as much as 5.4% on the Korean exchange, following a three-day market closure.

Pricing Power Returns to Samsung

Samsung Electronics' quote of up to $700 for HBM4 has attracted widespread market attention, with institutions generally believing it reflects the ongoing tightness in the AI memory market.

Charu Chanana, Chief Investment Strategist at Saxo Markets, stated that Samsung's HBM4 quote once again highlights the industry's "pricing power." He said:

"This indicates that the AI memory market remains tight, and Samsung believes it has regained some pricing advantages in the high-end market."

Bloomberg Industry Research analyst Masahiro Wakasugi noted in a research report that the $700 price means Samsung's HBM4 operating profit margin could reach 50% to 60%. The report stated:

"If Samsung supplies more HBM chips to Nvidia, the average price gap between Samsung and SK Hynix will narrow by 2026, as Nvidia's prices should be higher than those of other customers."

According to unnamed industry sources cited by Chosun Ilbo, SK Hynix may follow Samsung's higher pricing, further reinforcing the upward price trend in the industry.

Samsung Races to Catch Up in the AI Competition

After lagging behind SK Hynix in the early stages of the AI competition, Samsung is accelerating its catch-up. The company announced last week that it has begun mass production of HBM4 chips and is shipping commercial products to customers. HBM4 is a high-performance memory chip designed specifically for AI applications, crucial for training and running large AI models.

This development marks a recovery in Samsung's competitiveness in the high-bandwidth memory market. The ongoing shortage of memory chips is creating a favorable market environment for Korean chip manufacturers like Samsung and SK Hynix, allowing them to maintain strong pricing power in the high-end AI chip market