Fears of the impact of the Trump administration’s import taxes caused the world’s largest memory chip company’s shares to fall to their lowest since 2020.
Samsung Electronics shares are currently down 3.4% to 51,200 won – the lowest since June 2020. This code has fallen for 4 consecutive sessions and is currently the code with the worst performance among global chip companies this year.
Lee Min-hee – analyst at BNK Investment & Securities – said that the risk of US President-elect Donald Trump increasing import tariffs on Chinese goods is considered a big challenge for Samsung. Because compared to rival SK Hynix (Korea), this company is more dependent on Chinese customers.
Hynix is increasingly selling high-end AI server chips to US customers like Nvidia. Samsung Electronics is also considered slower than its competitors in meeting the market’s explosive demand for AI chips.
Inside a Samsung Electronics store in New York City (USA). Image: Reuters
Early last month, Samsung Electronics Vice President Jun Young-hyun issued a statement apologizing to customers, investors and group employees for disappointing third-quarter forecast profits. By the end of the month, they announced official figures, with third quarter operating profit only reaching 3,860 billion won (2.8 billion USD), down 40% compared to the previous quarter.
During the election campaign, Mr. Trump threatened to impose a 10% tax on all goods imported into the US, with China specifically at 60%. This could reduce demand for electronic devices that use chips, said Greg Noh – analyst at Hyundai Motor Securities.
Last week, South Korean President Yoon Suk Yeol also expressed concern about Trump’s threat to impose high import tariffs on Chinese imports. Because this could cause Chinese chip companies to lower export prices, making it difficult for Korean businesses to compete. The chip segment last year contributed 16% of export turnover for this country.
Since the beginning of the year, Samsung shares have dropped 34%, on track to record their worst year in more than two decades. In contrast, SK Hynix shares increased 32% and Nvidia shares increased nearly 200%.