Samsung to face questions from shareholders after AI chip failings, stock price drop

Hyunjoo Jin

Tue, Mar 18, 2025, 2:30 AM 2 min read

By Hyunjoo Jin

SEOUL (Reuters) - Samsung Electronics is acceptable for a pugnacious yearly wide gathering connected Wednesday with shareholders frustrated by its nonaccomplishment to thrust a roar successful artificial quality that made it 1 of the worst-performing tech stocks past year.

Co-CEO Han Jong-hee and the caput of its spot part Jun Young-hyun volition beryllium among executives attending the gathering which is scheduled to commencement astatine 9 a.m. (0000 GMT). Other issues successful absorption see strategies to mitigate the interaction of U.S. tariffs and what volition thrust caller growth.

In interior meetings, Samsung has acknowledged it has mislaid its technological edge. This is peculiarly existent successful semiconductors wherever it lags SK Hynix successful precocious bandwidth representation (HBM) chips that Nvidia and others trust connected for AI graphic processing units.

"Our technological borderline has been compromised crossed each our businesses," according to a transcript of a connection from Chairman Jay Y. Lee fixed to an interior enforcement seminar that was seen by Reuters.

"It's hard to spot that efforts are being made to thrust large innovation oregon tackle caller challenges. There are lone efforts to support a presumption quo alternatively than shaking things up."

Shares successful Samsung tumbled by astir a 3rd past twelvemonth portion those of SK Hynix climbed 26%. In caller years, Samsung has besides mislaid marketplace stock to TSMC successful declaration spot manufacturing and to Apple and Chinese rivals successful smartphones.

In January, Samsung warned of sluggish income of its AI chips successful the existent 4th owed to U.S. export restrictions to China, which has go its astir important market. That besides means it faces bigger headwinds than rivals from imaginable U.S. tariffs connected China.

The tech elephantine launched a stock buyback program worthy 10 trillion won ($7.2 billion) successful November aft its banal plunged to much than four-year lows. Its shares person gained 7% since then.

Samsung is South Korea's astir invaluable company, with its marketplace capitalisation of $235 cardinal accounting for 16% of the full worth of the country's main bourse. Nearly 40% of investors successful South Korean stocks ain Samsung shares, according to marketplace data.

(Reporting by Hyunjoo Jin; Editing by Miyoung Kim and Edwina Gibbs)