The artificial intelligence (AI) landscape is rapidly evolving, and a new contender is emerging to challenge Nvidia’s dominance: Google’s Tensor Processing Units (TPUs). This shift is generating significant excitement in the semiconductor industry, particularly in South Korea, with expectations rising that increased demand for high-bandwidth memory (HBM) will substantially benefit giants like Samsung Electronics and SK Hynix. A recent report by Pulse, the English service of Maeil Business News Korea, details how Google’s moves are poised to reshape the AI hardware market and create lucrative opportunities for key players in the memory chip sector.
Google’s TPU: A Rising Force in AI Hardware
For years, Nvidia has held a near-monopoly on the AI chip market, controlling over 90% of the share. However, Google is actively disrupting this status quo with its internally developed TPUs. These chips are already powering Google’s advanced AI model, Gemini 3, and the company is now looking to expand their reach by offering them to other Big Tech firms.
Reports indicate that Meta, the parent company of Facebook and Instagram, is seriously considering adopting TPUs for its upcoming data centers, slated to come online in 2027. This potential partnership signifies a major vote of confidence in Google’s AI hardware capabilities.
TPU Performance and Cost-Efficiency
TPUs, jointly developed with Broadcom, are designed for the specific demands of AI workloads, offering both speed and efficiency. Crucially, they present a compelling alternative to Nvidia’s Graphics Processing Units (GPUs). Industry analysis suggests that TPUs can deliver comparable, and in some cases superior, AI performance without relying on Nvidia’s hardware.
However, the most significant advantage of TPUs lies in their cost-effectiveness. Estimates suggest they are up to 80% cheaper than Nvidia’s flagship H100 GPU. While Google’s latest generation, the Ironwood TPU, might not surpass Nvidia’s upcoming Blackwell chips in raw computational power, it still outperforms the H200, making it a highly competitive option.
The HBM Boom: A Direct Benefit to South Korean Semiconductor Companies
The increasing adoption of TPUs is expected to fuel a surge in demand for high-bandwidth memory. Each TPU requires six to eight HBM modules, meaning any expansion in TPU production directly translates to increased HBM orders. This is particularly good news for SK Hynix, which is already a key supplier of fifth-generation HBM3E chips for Google’s Ironwood TPU.
Industry observers predict that SK Hynix will likely continue as a primary supplier, providing the advanced 12-layer HBM3E modules for the next-generation TPU, codenamed “7e.” This sustained partnership positions SK Hynix for significant growth. Samsung Electronics, a major competitor in the memory market, is also poised to benefit from this rising demand.
Supply Shortages and Rising Prices
Analysts are already anticipating supply constraints as Google ramps up its HBM adoption. Chae Min-sook, an analyst at Korea Investment & Securities, stated that the increased demand will “act as a catalyst, exacerbating the current supply shortage.” This scarcity is expected to drive up both average selling prices (ASPs) and shipment volumes, creating a “dual benefit” scenario for SK Hynix and Samsung Electronics. Beyond HBM, the anticipated expansion of AI data centers will also boost demand for conventional DRAM, like DDR5 and LPDDR5, further bolstering memory sales.
Samsung’s Broader Opportunities in the AI Ecosystem
The benefits for Samsung extend beyond just increased memory shipments. The company’s foundry business is also gaining traction as a viable alternative to Taiwan’s TSMC, the current leader in advanced chip manufacturing. TSMC has been steadily increasing prices for its cutting-edge processes, making Samsung’s foundry services more attractive, especially given recent improvements in yield rates for its 3-nanometer and 2-nanometer nodes.
Samsung’s unique strength lies in its ability to offer “turnkey solutions,” integrating memory, foundry, and advanced packaging capabilities. This comprehensive approach provides a significant strategic advantage. Furthermore, the expansion of Google’s AI ecosystem through TPUs could positively impact sales of Samsung’s Galaxy smartphones, which are increasingly powered by Gemini AI.
The Texas Fab Plant: A Potential Game Changer
Samsung’s upcoming fabrication plant in Taylor, Texas, is a crucial piece of this puzzle. This facility will be capable of producing chips below the 2-nanometer threshold, positioning Samsung to capitalize on the growing demand for advanced semiconductors. According to an anonymous industry source quoted in the Pulse report, the Texas plant represents a “major opportunity” if the TPU market continues its current trajectory. The ability to manufacture these advanced chips domestically for Google and other potential TPU customers could solidify Samsung’s position as a key player in the AI hardware supply chain.
In conclusion, Google’s push into AI hardware with its TPUs is creating a ripple effect throughout the semiconductor industry. The anticipated surge in demand for high-bandwidth memory is set to be a major boon for South Korean giants Samsung Electronics and SK Hynix. Coupled with Samsung’s advancements in foundry technology and its integrated capabilities, the company is well-positioned to benefit from the broader expansion of the AI ecosystem. This shift towards diversified suppliers promises to improve profitability across the entire supply chain, marking a significant turning point in the AI hardware landscape. The coming years will be critical in observing how these developments unfold and reshape the future of AI technology.
