Samsung Electronics is gearing up for a transformative year in 2025 as it looks to revitalize growth through major deals and strategic acquisitions. At its annual general meeting, the company’s leadership faced intense scrutiny from shareholders, who voiced concerns over weak earnings, falling stock prices, and lagging AI-driven semiconductor advancements.
A Pledge to Regain Competitiveness
Samsung’s co-CEO Han Jong-hee acknowledged the company’s underperformance in the rapidly evolving AI semiconductor sector. He admitted that Samsung had failed to capitalize on the AI boom, unlike competitors SK Hynix and TSMC, which have gained significant ground in high-bandwidth memory (HBM) chips used for AI-driven GPUs.
Despite recent setbacks, Samsung shares rebounded 2.6% following the announcement of upcoming mergers and acquisitions. The company also introduced a stock-based performance incentive last year and is now considering extending it to employees to stabilize stock performance.
Major Acquisitions on the Horizon
As global economic uncertainty looms, Samsung is set to pursue “meaningful” mergers and acquisitions (M&As) to reclaim its technological edge. However, co-CEO Han cautioned that semiconductor-related acquisitions could face regulatory hurdles and geopolitical tensions, particularly in markets like China and the United States.
Chairman Jay Y. Lee reportedly acknowledged in an internal seminar that Samsung’s edge has been compromised across multiple business segments, including semiconductors, smartphones, and contract chip manufacturing.
Key factors influencing Samsung’s market position:
- HBM Chip Lag: Samsung has fallen behind SK Hynix in high-bandwidth memory used in AI-driven chipsets.
- Smartphone Competition: Apple and Chinese brands continue to eat into Samsung’s market share.
- Contract Chip Manufacturing: TSMC has widened the gap as the leading third-party chip fabricator.
U.S. Tariffs and Market Challenges
Samsung is also bracing for potential tariff adjustments under U.S. President Donald Trump’s administration, which is reevaluating semiconductor projects that received billions in subsidies through the 2022 CHIPS Act. While Samsung, Intel, TSMC, Micron, and SK Hynix are among the key beneficiaries, Samsung must navigate shifting trade policies and export restrictions on advanced chip sales to China, one of its biggest markets.
Looking Ahead: A Critical Year for Samsung
Samsung’s semiconductor division co-CEO Jun Young-hyun reaffirmed the company’s commitment to restoring its competitive edge, calling 2025 the year of recovery. The company aims to:
- Accelerate mergers and acquisitions to strengthen its semiconductor and AI capabilities.
- Address market share losses in smartphones and chip manufacturing.
- Enhance strategic investments in the U.S. to mitigate tariff risks.
With 40% of South Korean investors holding Samsung shares and the company accounting for 16% of the country’s total market value, Samsung’s success in 2025 will be closely watched by global markets.
