A NVIDIA logo is displayed at SIGGRAPH 2017 in Los Angeles, California, on July 31, 2017. REUTERS
Samsung Electronics' fifth-generation high bandwidth memory (HBM) chips, known as HBM3E, have passed Nvidia's tests for use in its artificial intelligence (AI) processors, according to three sources familiar with the results. This marks a significant achievement for Samsung, the world's largest memory chipmaker, which has been striving to compete with local rival SK Hynix in the market for advanced memory chips needed for generative AI tasks.
Although Samsung and Nvidia have not yet signed a supply agreement for the approved eight-layer HBM3E chips, they are expected to do so soon, with shipments anticipated to begin by the fourth quarter of 2024, the sources said. However, Samsung's 12-layer version of the HBM3E chips still needs to pass Nvidia's tests.
Both Samsung and Nvidia declined to comment on the matter.
HBM is a type of dynamic random access memory (DRAM) introduced in 2013, with chips stacked vertically to save space and reduce power consumption. These chips are crucial for graphics processing units (GPUs) used in AI, as they help process vast amounts of data generated by complex applications.
Samsung has been working to pass Nvidia's tests for its HBM3E and earlier HBM3 models since last year but faced challenges related to heat and power consumption. The company has since redesigned its HBM3E chips to address these issues.
In May, Samsung stated that claims of its chips failing Nvidia's tests due to heat and power problems were incorrect. The recent test approval comes after Nvidia certified Samsung's HBM3 chips for use in less advanced processors for the Chinese market.
The approval of Samsung's latest HBM chips by Nvidia comes amid growing demand for advanced GPUs driven by the rise of generative AI. According to research firm TrendForce, HBM3E chips are expected to become the mainstream HBM product this year, with shipments peaking in the second half. SK Hynix, the leading manufacturer, estimates that demand for HBM memory chips could grow at an annual rate of 82% through 2027.
In July, Samsung forecasted that HBM3E chips would account for 60% of its HBM chip sales by the fourth quarter, a target that analysts believe is achievable if the latest chips receive Nvidia's final approval by the third quarter.
Samsung does not disclose revenue details for specific chip products. However, according to a survey by 15 analysts, Samsung's total DRAM chip revenue for the first half of this year was estimated at 22.5 trillion won ($16.4 billion), with about 10% possibly coming from HBM sales.
There are only three main manufacturers of HBM chips: SK Hynix, Micron, and Samsung. SK Hynix has been the primary supplier of HBM chips to Nvidia and shipped HBM3E chips to an unidentified customer, which sources later confirmed was Nvidia. Micron has also announced that it will supply Nvidia with HBM3E chips.
