Samsung Electronics is setting its sights on major acquisitions and strategic partnerships as it struggles to regain momentum in the highly competitive tech industry. The South Korean giant has faced increasing pressure from shareholders after failing to capitalize on the artificial intelligence (AI) boom, which has seen rivals such as TSMC and Apple gain significant ground.
During a shareholder meeting on Wednesday, Samsung’s leadership acknowledged the company’s struggles in the contract chip manufacturing sector, where Taiwan Semiconductor Manufacturing Company (TSMC) has outpaced it in securing key clients for AI-driven semiconductor production. Additionally, Samsung has been losing market share in the smartphone sector, where Apple and Chinese competitors have continued to innovate and capture consumer interest.
Samsung’s difficulties have been reflected in its financial performance, with declining earnings and a sluggish stock price. In 2023, Samsung was among the worst-performing tech stocks, a stark contrast to competitors that thrived due to the surging demand for AI technologies. While Samsung remains a dominant player in memory chips, it has struggled to stay ahead in advanced semiconductor technologies essential for AI applications.
To counter these setbacks, Samsung CEO Kyung Kye-hyun emphasized the company’s intent to pursue mergers and acquisitions (M&A) to enhance its capabilities and market position. “We are actively looking for major deals that can drive growth and ensure Samsung remains a leader in the global tech industry,” he said.
Analysts believe that potential acquisitions could focus on AI-related semiconductor firms, software developers, or companies specializing in contract chip manufacturing. Expanding its AI chip production could allow Samsung to tap into the lucrative market currently dominated by Nvidia and other industry leaders.
Despite these challenges, Samsung has a solid foundation to rebuild its competitive edge. It remains one of the world’s largest technology companies with a vast ecosystem of products, from semiconductors to consumer electronics. The company has also increased investment in AI and high-performance computing chips to regain its technological lead.
As Samsung charts its path forward, all eyes will be on how effectively it executes its M&A strategy and whether it can turn its AI struggles into an opportunity for resurgence in the global tech landscape.
