The battle for HBM intensifies! Samsung plans to expand its 4-nanometer process capacity, increasing competitive pressure on SK Hynix (SKHY.US) and Micron (MU.US).

According to reports from Zhihu Finance APP, Samsung Electronics is preparing to expand its advanced foundry capacity as surging demand for next-generation memory chips is pushing its 4-nanometer production lines to full capacity.

This move is likely to intensify competition with SK Hynix (SKHY.US) and Micron (MU.US)—the three memory giants are vying for market share in the rapidly growing AI chip sector.

Samsung expands memory capacity

Korean media reports that Samsung is considering expanding its 4-nanometer wafer foundry capacity to support production of HBM4 base dies. The base die is located beneath the DRAM stack and acts as the logic layer connecting memory to the AI accelerator.

Unlike SK Hynix, which uses TSMC’s 12-nanometer process to manufacture HBM4 base dies, Samsung is using its own 4-nanometer process to produce this component internally.

Samsung has already allocated more than half of its current 4-nanometer capacity to the production of HBM4 base dies. Demand also comes from other customers, including NVIDIA’s Groq 3 LPU, prompting Samsung to raise prices for new 4-nanometer orders.

Intensifying HBM competition

This capacity expansion comes as Samsung accelerates the HBM4 production ramp-up. The company expects HBM4 revenue to more than triple quarter-on-quarter in the third quarter, with HBM4 accounting for more than 60% of all its HBM revenue in the second half of the year.

Samsung’s growth is reshaping the competitive landscape. Counterpoint data shows Samsung’s HBM revenue share rose from 21% in the first quarter to 33% in the second quarter, while SK Hynix holds 50% and Micron has 18%.

The company is also considering building a new 2-nanometer production line for HBM5, as it is expected that HBM5 base dies will be produced using the 2-nanometer process. This could further strengthen Samsung’s vertically integrated approach, merging memory, logic manufacturing, and advanced packaging into a single flow.

Pressure on SK Hynix and Micron

For SK Hynix and Micron, Samsung’s faster HBM4 ramp-up presents another competitive challenge just as AI infrastructure investment is driving high-bandwidth memory demand to unprecedented levels.

In June this year, Samsung became the first supplier to complete HBM4 validation and begin deliveries, while SK Hynix faced certification delays, and Micron remains more focused on HBM3E.

Citi expects global HBM bit demand to grow by 62% next year, potentially putting the industry in a supply shortage. This means Samsung’s capacity expansion may allow it to capture a larger share of this fast-growing market.