Supermicro, currently facing serious accounting fraud allegations, announced a comprehensive liquid cooling solution in its press release on October 7th. The company revealed that it is delivering over 100,000 GPUs equipped with this liquid cooling technology to some of the largest AI factories.

As per a report from CNBC, if the average price of the aforementioned GPU is similar to NVIDIA’s $30,000 chips, this order could potentially amount to several billion dollars.

According to Supermicro, this complete liquid solution includes “powerful Coolant Distribution Units (CDUs), cold plates, Coolant Distribution Manifolds (CDMs), cooling towers and end to end management software.” It is designed to reduce power costs and Day 0 hardware acquisition and data center cooling infrastructure costs.

However, CNBC also noted that while the announcement was well-received on Wall Street, Supermicro is approximately nine weeks late in submitting its annual report, which was originally due in August. Later that month, Supermicro stated that it required more time “to complete its assessment of the design and operating effectiveness of its internal controls over financial reporting as of June 30, 2024.”

On August 27, AI server giant Supermicro was accused of accounting violations, inadequate disclosure of related party transactions, and evading sanctions by selling products to Russia by Hindenburg Research.

The following day, Supermicro also announced a delay in submitting its 2024 fiscal year annual report. According to a report from Wccftech, Supermicro’s latest announcement might be an attempt to alleviate concerns resulted from its delayed annual report.

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(Photo credit: Supermicro)

Samsung reported its third-quarter earnings today, and according to The Korea Economic Daily, the company’s operating profit was initially expected to exceed 10 trillion won, but the actual performance fell short of that target.

Reuters also reported that Samsung Electronics warned its third-quarter profit would fall short of market expectations, issuing an apology for the disappointing performance. The tech giant has been lagging behind its rivals in supplying high-end chips to Nvidia amid the booming AI market.

The Korea Economic Daily noted that Samsung’s operating profit for the third quarter reached 9.1 trillion won, a 274.5% increase from the same period last year. However, this figure still fell significantly short of the expected 10 trillion won. Sales for the quarter amounted to 79 trillion won, up 17.2% year-on-year. The Device Solutions (DS) division, responsible for semiconductor operations, saw its performance decline compared to the previous quarter due to one-off costs, including incentive provisions.

Although demand for memory chips such as servers and high-bandwidth memory (HBM) remained stable, factors like inventory adjustments by mobile clients and increased supply of legacy products from Chinese memory manufacturers negatively impacted performance, exacerbated by one-time costs and exchange rate effects. Additionally, the weaker-than-expected recovery in demand for Samsung’s flagship conventional DRAM products, particularly due to sluggish smartphone and PC markets, further hindered its results.

In the same report by The Korea Economic Daily, it was noted that in the HBM sector, Samsung has yet to make significant progress. The commercialization of its fifth-generation HBM, HBM3E, has been delayed, with the product still undergoing quality tests by NVIDIA. However, the Device Experience (DX) division saw improved performance due to strong flagship smartphone sales, and Samsung Display benefited from new product launches by key customers.

The Korea Economic Daily highlighted that analysts had forecast Samsung’s third-quarter operating profit to surpass 10 trillion won, with sales expected to reach around 81 trillion won, but both figures missed these projections.

Before Samsung’s earnings announcement, The Korea Times had reported that the market expected SK Hynix to see a substantial increase in operating profit driven by strong HBM demand, potentially outpacing Samsung’s semiconductor division.

Regarding Samsung’s HBM3E validation, TrendForce noted in a September press release that while Samsung entered the HBM3E market later, the company recently completed validation and has begun shipping its HBM3E 8Hi units. According to TrendForce’s latest research, Samsung, SK Hynix, and Micron submitted their first HBM3E 12Hi samples in the first half and third quarter of 2024, with ongoing validation processes. SK Hynix and Micron are progressing faster and are expected to complete validation by the end of this year.

(Photo credit: Samsung)

Following Intel’s decision of carving out its foundry business, there are rumors circulating that the same move may benefit Samsung as well. However, according to the latest reports by Reuters and Business Korea, Jay Y. Lee, Chairperson of the South Korea semiconductor giant, has expressed no interest in spinning off its contract chip manufacturing and logic chip design operations.

Citing Lee’s remarks in his visit in Philippines on October 7th, Reuters notes that he has no plans to spin off the company’s struggling foundry and system LSI businesses, marking the first time he has publicly addressed the issue.

Samsung’s foundry business has been facing headwinds, as it reportedly suffers from unstable yields though it ramped up the production of its Gate-All-Around (GAA) 3nm second-generation process in the second half of the year, which hinders the company from attracting major clients.

According to Business Korea, Samsung Foundry reportedly faced a deficit of over 2 trillion won last year due to weak orders. The situation does not get better this year, as the company is anticipated to experience several trillion won in losses as well.

Therefore, a previous report from Business Korea reveals that Samsung Securities, a subsidiary of the group, recommended that Samsung should spin off its foundry division and list it in the U.S. in a report titled “Geopolitical Shifts and Industry.” However, the potential divestiture has been dismissed by Lee.

Citing Lee’s latest comments, Business Korea notes that Samsung is “eager to grow” the foundry business.” However, he also confirmed that Samsung’s plant in in Taylor, Texas, has faced hurdles, as he noted that the project has been “a bit tough due to changing circumstances (and the U.S. presidential) election,” according to Business Korea.

In response, Samsung has reportedly delayed the construction and orders for its Pyeongtaek Phase 4 (P4) facility and the second foundry plant in Taylor, Texas. According to Reuters, Samsung has pushed back the expected start date for operations at the under-construction foundry plant in Taylor from late 2024 to 2026.

According to Business Korea, Lee unveiled the ambitious “System Semiconductor Vision 2030” for Samsung in 2019, which aims to invest 133 trillion won in its system semiconductor sector, including foundries, by the end of the decade, with the objective of establishing Samsung as a leader in the system semiconductor market.

By 2021, the plan was said to be expanded to 171 trillion won, further underscoring Samsung’s commitment to this vision. However, Samsung has been struggling to rival TSMC in the foundry sector, while its leading position in the memory has also been challenged by SK hynix, which benefits from the booming demand of AI with its HBM.

(Photo credit: Samsung)

NVIDIA CEO Jensen Huang’s current personal worth has exceeded the entirety of Intel. According to reports from TechNews, Tom’s Hardware, Huang’s current net worth has reached USD 109.2 billion, more than Intel’s total market cap of around USD 96 billion.

In early August, Intel has faced its most serious financial troubles in 50 years, with its stock prices plummeting 22%. In order to attract foundry customers, the company will transform its foundry business into a wholly-owned subsidiary with its own board of directors.

According to Tom’s Hardware, social media users have been sharing posts encouraging Jensen Huang to buy Intel. Currently, Huang holds more than 75 million NVIDIA share, with 786 million more through various trusts and a partnership. Even though he has cashed in more than USD 700 million by selling 6 million shares this year, it is merely a tiny fraction compared with the total value of his NVIDIA holdings of over USD 100 billion.

According to Forbes’ real-time billionaires list, Huang’s net worth currently ranks 11th in the world, just USD 20 billion away from breaking into the top ten. With growth driven by the AI boom, NVIDIA has become one of the largest tech companies by market capital in the world, alongside Microsoft, Apple, Amazon, and Google.

According to TrendForce, NVIDIA continues to remain the dominant supplier in the global AI server market in 2024. Specifically, in the GPU AI server market, NVIDIA commands an overwhelming lead with a nearly 90% market share, while AMD follows at a distant 8%.

(Photo credit: NVIDIA)

Global semiconductor sales surged to $53.1 billion in August, a record for the month, driven by booming demand from the AI wave, according to Semiconductor Industry Association (SIA). This marks a 20.6% year-on-year increase, the highest since April 2022, signaling continued momentum in the semiconductor industry.

Money DJ, citing the Semiconductor Industry Association (SIA), reported that global semiconductor sales in August reached $53.1 billion, up from $44 billion in the same period last year. Data compiled by the World Semiconductor Trade Statistics (WSTS) and published by SIA also showed a 3.5% month-on-month increase from July’s $51.3 billion.

“The global semiconductor market continued to grow substantially in August, hitting its highest-ever sales total for the month of August, and month-to-month sales increased for the fifth consecutive month,” said John Neuffer, SIA president and CEO. “Year-to-year sales increased by the largest percentage since April 2022, driven by a 43.9% year-to-year sales increase into the Americas, and month-to-month sales were up across all regions for the first time since October 2023.”

Regionally, the Americas led the growth in August with a 43.9% year-on-year jump in semiconductor sales, followed by China at 19.2%, the Asia-Pacific and other regions at 17.1%, and Japan at 2%. Europe was the only region to post a decline, down 9%.

On a monthly basis, semiconductor sales increased across all regions. The Americas posted a 7.5% rise, followed by Japan at 2.5%, Europe at 2.4%, China at 1.7%, and the Asia-Pacific and other regions at 1.5%.

Commercial Times reports that WSTS recently raised its global semiconductor sales forecast for 2024 to $611 billion, reflecting a 16% increase from last year, driven by strong demand in computing end markets over the past two quarters. Sales in the Americas and Asia-Pacific are expected to grow significantly this year, with annual increases of 25.1% and 17.5%, respectively. In contrast, Europe is forecast to grow by just 0.5%, while Japan is expected to see a 1.1% decline.

For 2024, WSTS predicts global semiconductor sales will rise further to $687 billion, though growth is expected to slow to 12.5%. All regions, however, are forecast to see positive growth.

(Photo credit: TSMC)