Return of the King of Storage? Morgan Stanley: Samsung's HBM business has fully surpassed competitors, profits may soar by 150% in 2026.

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Morgan Stanley believes that Samsung Electronics is regaining dominance in the memory market with its "technology-first leadership" strategy, and its earnings per share in 2026 will surge by more than 150% compared to 2025.

According to news from Chasing Wind Trading Desk, Morgan Stanley analysts stated in a November 23 report that Samsung has fully caught up in the field of high bandwidth memory (HBM). Samsung's HBM3e products have already been shipped to all AI computing customers, while HBM4 products are undergoing multiple qualification tests, with the first results expected to be announced in early December.

Unlike its competitors, Samsung does not need to modify design requirements. With its 1c DDR5 front-end technology, 4nm logic base die, and low power consumption, it maintains a leading edge in product quality and specifications—particularly its unique advantage at high speeds >11 Gbps, and its end-to-end solution capability from DRAM to foundry to packaging, positioning it to significantly increase market share.

Analysts emphasized that, as the key controller of the DRAM industry’s fate, Samsung currently has an effective DRAM capacity of 500,000 wafers (a total of about 650,000 wafers/month), far surpassing its competitors. The DRAM order fulfillment rate has fallen to about 70% of customer demand, and the visibility extends into the first half of 2026.

However, Samsung management is taking a more rational strategy—not chasing market trends, but working with key customers to achieve sustainable profitability based on real demand. The P4 plant’s design capacity of more than 100,000 wafers/month provides ample room for expansion in both memory and foundry businesses.

The worst is over for the foundry business, 2nm process wins multiple orders

Analysts believe that Samsung’s foundry business is ushering in a recovery. Improved utilization and advances in process technology will drive profit recovery. Samsung’s shift to a more customer-centric culture is starting to show results, and it has won multiple orders for its 2nm process. While output still needs to improve and finding large customers beyond Tesla remains a top priority, the overall outlook has markedly improved.

Thanks to strong pricing power under supply shortage conditions, Morgan Stanley expects Samsung’s 2026 earnings per share to reach 14,464 KRW, nearly 50% higher than the current market consensus forecast of 9,800 KRW. This profit growth is expected to drive improved P/E multiples. Analysts specifically pointed out that the market is unprepared for certain positive developments for Samsung, and transformations from relative earnings revisions to technological leadership (HBM4) could all become catalysts for the stock price.

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The above highlights are from Chasing Wind Trading Desk.

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