Samsung Faces Investor Scrutiny Over AI Struggles, Promises Growth Amid Challenges

Samsung Electronics is under pressure from investors after falling behind in the AI-driven semiconductor race. At its annual general meeting, shareholders questioned the company’s sluggish performance, with one longtime investor urging a stronger focus on its memory chip business.

Samsung’s struggles stem from losing ground in high-bandwidth memory (HBM) chips to SK Hynix and in contract chip manufacturing to TSMC. The company’s semiconductor segment, once a market leader, now trails competitors like Nvidia, which relies on advanced HBM chips for AI-driven processing. Chairman Jay Y. Lee admitted internally that Samsung’s technological edge has weakened across all divisions, attributing the slowdown to complacency rather than innovation.

Co-CEO Han Jong-hee acknowledged a tough 2025 ahead due to global economic uncertainties but assured investors of "meaningful" mergers and acquisitions to drive growth. Samsung launched a 10 trillion won ($7.2 billion) share buyback plan in November following a four-year stock low, helping its shares recover 7%. However, its stock plummeted nearly 30% last year, while SK Hynix gained 26%.

As South Korea’s most valuable company, Samsung holds a $235 billion market capitalization, accounting for 16% of the country’s stock market value. Nearly 40% of local investors own its shares, reflecting its deep economic influence.

With mounting pressure to reclaim its dominance in semiconductors and AI, Samsung’s next moves will be crucial in shaping its future and regaining investor confidence.