On Tuesday, Samsung unveiled a foldable phone, and US semiconductor company Nvidia announced that its next-generation gaming chip will be manufactured by the South Korean giant.
Samsung’s Galaxy Z Fold 2, the company’s third folding phone
The phone will be launched on September 18 for $1,999. Sanjeev Rana, the senior analyst at CLSA, stated that foldable phones will become mainstream from 2022 and the company is the first mover in this important category.
This set Samsung’s shares trading at 70.376.32 Korean ($59.14) in the next 12 months. It is reportedly a 29% increase from Wednesday’s trading price, as per an average target price collated by Refinitiv.
Daiwa Capital Markets’ SK Kim has reported a target price of 82,000 Korean ($68.91) which is a 50% rise from Wednesday’s trading price. Kim stated that they expect a favorable market environment in 2021 for Samsung Electronics, new foundry opportunities, and attraction valuation as compared to its peers such as TSMC.
Nvidia’s deal with Samsung
Want to publish your own articles on DistilINFO Publications?
Send us an email, we will get in touch with you.
Nvidia launched the GeForce RTX 30 Series of graphic processing units (GPUs). The chips are designed for PC gaming and they provide more realistic images on the screen, due to “ray-tracing”. This concept simulates how light reacts with objects around it.
Nvidia has chosen Samsung to manufacture the chips using an 8-nanometer process customized for these semiconductors. A positive move for Samsung, Kim stated that he expects the Nvidia deal to be worth $1 billion.
Samsung’s semiconductor business includes the foundry business as well as the NAND and DRAM chips manufactured by the company, used in laptops and smartphones. Semiconductors have accounted for two-thirds of Samsung’s operating profit in the second quarter of this year.
Troubled times ahead for Huawei
Meanwhile, Huawei is having a troublesome time. Last year, it was added to the US blacklist which cut off the Chinese phone giant’s access to Google’s Android operating system. Although, it is not a big deal in China where Google services are blocked.
In May, Washington amended the foreign-produced direct product rule (FDPR) which requires foreign manufacturers that use American chipmaking equipment to get a license before they sell semiconductors to Huawei. This move will cut off Huawei from the key chips it requires for its products.
CLSA’s senior analyst Rana stated that Huawei’s loss will be Samsung’s gain, as the former will be impacted by a decline in its global smartphone market share. Huawei’s weakness will present several significant opportunities for Samsung.