China Overtakes US as Largest Buyer of Samsung Chips

Samsung controls the chip market in China (photo: x @SamsungUS)

JAKARTA - Samsung's presence in the Chinese smartphone market is indeed relatively small. However, this South Korean technology giant is actually a major player in supplying memory chips to the country.

A recent report revealed that Samsung exported chips worth USD 44.6 billion (IDR 729.2 trillion) to China in 2023. This amount surpassed exports to the United States which reached US$42.1 billion (IDR 688.3 trillion). This increase reached 53.9% compared to the previous year, driven by China's economic stimulus policy aimed at increasing demand for new devices.

The aggressive steps of the Chinese government, which has poured more than USD 20 billion (IDR 327 trillion) into the market, have encouraged people to replace old smartphones and household appliances with the latest models. This condition has significantly increased demand for memory chips, which benefits suppliers such as Samsung and SK Hynix.

Samsung mainly supplies NAND flash, LPDDR memory, image sensors, and display driver ICs to China, as well as some high-speed memory modules (HBM). The company is implementing a two-track strategy, where they sell legacy memory products in China and market advanced HBM modules to Western countries such as the US.

However, as Samsung’s dominance in China becomes more apparent, the company could potentially face headwinds from US-imposed chip sanctions. These restrictions could prevent Samsung from selling some of its most profitable advanced memory products to China in the near future.

As the US-China trade war continues, industry analysts warn that these sanctions could be expanded, forcing Samsung and other chipmakers to find a balance between the two major economic powers.

For now, Samsung remains a key player in China’s technology supply chain. However, its future success will depend largely on how the company adapts to the evolving geopolitical landscape.