With falling chip prices and weak demand in 2025, numerous reports suggest Samsung is facing mounting challenges from Chinese rivals, potential US tariffs, and stalled policies.
Samsung Electronics is reportedly grappling with multiple challenges, including fierce competition from Chinese firms, potential US tariff hikes, and sluggish progress in South Korea’s semiconductor policies.
According to Liberty Times which cited Chosun Daily, these difficulties have compounded pressures on the company, particularly in the semiconductor sector, which is facing ongoing price drops and weakened demand.
The most pressing concern for Samsung is the rise of Chinese competitors in the DRAM market. Having rapidly expanded their production capacity, Chinese suppliers now account for the largest portion of global DRAM output outside of the top three suppliers.
This shift, coupled with a continued dip in consumer electronics demand, is expected to exacerbate pricing issues in 2025, according to TrendForce.
Another threat arises from the political climate in the US. Donald Trump’s anticipated return to office in January 2025 could bring back protectionist trade policies. These may lead to higher tariffs on Samsung’s memory chips, further inflating costs and potentially reducing demand for smartphones and PCs that use these components.
Samsung also faces hurdles within South Korea, where the K-Chips Act, which aims to exempt semiconductor R&D personnel from the 52-hour workweek limit, has stalled in the legislative process. This bill is seen as crucial for fostering innovation in the sector. However, its potential impact is limited, benefiting only a small percentage (around 9%) of Samsung’s 75,000 semiconductor workforce.
To overcome these challenges, the report has suggested that Samsung must advance in areas such as AI chips and high-bandwidth memory (HBM). The company’s ability to navigate these issues and secure policy support will be vital for its future growth in the highly competitive global semiconductor market.
