Samsung Electronics has vowed to pursue bold acquisitions and deal-making in 2025 as part of a “do or die” bid to revive its growth. This promise comes after the South Korean tech giant faced sharp criticism from shareholders, who have grown increasingly dissatisfied with the company’s weak performance across all core businesses in 2024. At its annual meeting in Suwon, south of Seoul, roughly 900 individual and institutional investors voiced their displeasure over a significant drop in the company’s stock value, which has fallen almost 20% over the past year, even amid a global boom in demand for artificial intelligence-related hardware that has benefited competitors.
Samsung’s co-CEO, Han Jong-hee, issued an apology to investors, admitting that the company’s technological competitiveness has weakened in recent years. “There are some difficulties in doing semiconductor M&As due to regulatory issues and various national interests, but we’re determined to produce some tangible results this year,” Han said, committing to achieving growth through strategic deals. This sentiment was echoed by Samsung’s billionaire scion, Lee Jae-yong, who described the company’s situation as a “question of survival” after it reported its first broad market share decline in a decade.
The company’s market share slipped across all its major sectors in 2024. In DRAM memory chips, its share fell from 42.2% to 41.5%, while smartphone shipments dropped from 19.7% to 18.3%. The biggest decline was in smartphone display panels, which saw a sharp drop from 50% to 41.3%. Samsung’s TV market share also shrank from 30.1% to 28.3% amid intensifying competition from Chinese rivals. Meanwhile, its subsidiary Harman’s in-car technology products experienced a decline from 16.5% to 12.5%.
In light of this, Lee told executives, “What matters is not the crisis itself, but our attitude in dealing with it,” urging the company to focus on future investment, even at the expense of short-term profits. Samsung has reorganized its engineering team to strengthen its position in advanced memory chips, particularly high-bandwidth memory (HBM) used in AI hardware. However, the company has yet to meet the qualification standards required to supply Nvidia, a major player in the AI space.
Additionally, Samsung’s foundry business, which makes chips for external clients, has been grappling with significant losses as it struggles to close the technology gap with its main rival, Taiwan Semiconductor Manufacturing Company (TSMC). Last year, Samsung announced plans to build a $40 billion foundry in Texas, focused on producing cutting-edge logic chips and advanced packaging for AI chips. However, analysts have raised concerns about the viability of the project, with some warning that the $17 billion foundry in Taylor City could become a “big stranded asset” due to a lack of clients.
President Trump’s threats to impose tariffs on imported semiconductors and potentially scrap the $52 billion Chips Act, which would provide Samsung with $4.75 billion in subsidies for its Texas plant, further complicate the company’s outlook. While TSMC has committed to a $100 billion investment plan in the US, Samsung’s ability to match such moves remains uncertain. The growing rivalry between TSMC and Samsung has been compounded by speculation that TSMC could assist Intel in running its fabrication plants, which could intensify competition for Samsung.
Investors have also called for a more radical overhaul of Samsung’s management structure, with some arguing that Lee Jae-yong’s continued influence over the company—despite not holding an official position on the board—limits the company’s potential for innovation and long-term success. Chan Lee, a managing partner at Petra Capital Management, suggested that Lee should relinquish control over daily operations and empower CEOs with engineering backgrounds, as his father did, instead of relying on managers focused on short-term profits.
Samsung has pledged to focus its future investments on robotics, medical technology, and next-generation semiconductors as part of its strategy to drive AI-related growth. Additionally, the company is hopeful that an anticipated recovery in the memory chip cycle will boost its earnings in the latter half of the year. However, the pressure is mounting for Samsung to prove it can recover its leadership in the global tech market and regain the trust of its shareholders.
