Samsung vs. LG battle for AI cooling heats up

The article analyzes the semiconductor sector, highlighting key companies like ASML, TSMC, Micron, SK Hynix, Samsung, Synopsys, Cadence, Nvidia, and AMD. It discusses supply chain dependencies, with Nvidia as a demand hub and others as critical chokepoints. Recent financial data includes TSMC's raised capex to $62B, ASML's strong sales, and Nvidia's revenue growth of 106%. The sector saw a trillion-dollar market value drop in late July, followed by a rebound driven by supply constraints and stro

South Korea's 821 trillion won ($597 billion) budget includes 23.9 trillion won for tech and semiconductor projects. Samsung Electronics (SSNLF) is central to this, with Q2 revenue of 171.5 trillion won and operating profit of 89.5 trillion won. The budget aims to boost AI infrastructure, benefiting Samsung while increasing its tax burden.

LG Electronics partnered with CoAsia SEMI and Samsung Foundry to develop AI chips for smart home appliances, bypassing TSMC. The deal, part of South Korea's government-backed semiconductor program, involves a ₩31 billion budget and runs through 2030. Samsung's foundry is chosen for its process-specific optimization, potentially creating long-term supply chain alignment. LG aims to lead the ambient AI home market with these ultra-low-power chips.

Samsung's Galaxy Z Fold 8 has seen strong demand with 4.7-5.2 million preorders, causing supply chain issues. A component shortage, the Display Driver IC, is delaying production. Samsung is diverting resources to meet demand, potentially impacting future releases like the Galaxy S27. UMC, based in Taiwan, is manufacturing the chips at full capacity.

Samsung Electronics has secured 70% of its memory production capacity through long-term supply agreements, driven by high demand for high bandwidth memory (HBM) in AI infrastructure, exacerbating the chip shortage.

South Korea proposed a record $597B 2027 budget, up 12.8% from 2026, to boost AI and tech. Funded by semiconductor industry profits, it aims to cut debt-to-GDP to 48.3%. Samsung and SK Hynix drive tax revenue growth. Budget includes $2.6B for semiconductors and $3.4B for defense. Parliamentary approval is needed.