As Samsung Electronics reports record-breaking quarterly operating profits, Japanese media, which once ceded leadership in memory semiconductors to Korean firms, is highlighting the pros and cons of the current memory boom.

The Nihon Keizai Shimbun (Nikkei) reported on July 8 that Samsung Electronics posted a preliminary operating profit of 89.4 trillion won for the second quarter of this year, marking its third consecutive quarter of record-high performance. The report noted that the sharp rise in prices for memory semiconductors used in artificial intelligence (AI) is emerging as a new management risk for the Korean semiconductor industry.

Nikkei mentioned that some U.S. consumers have filed class-action lawsuits, alleging that they were harmed by price-fixing among memory chipmakers, including Samsung Electronics, SK Hynix, and Micron.

The report also pointed to concerns regarding the growing trend of U.S. companies, facing chronic memory shortages, moving to use semiconductors from Chinese manufacturers such as ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC).

Citing views from Korean experts, Nikkei pointed out that with Samsung Electronics and SK Hynix combined holding a 60% share of the global memory market, concerns over trade issues are also being raised.

The analysis suggests that the U.S. administration under Donald Trump could potentially take issue with the excessive market dominance of Korean memory firms, pressuring them to relocate production bases to the U.S. or increase local investment.

This appears to be a reference to the 1980s, when the U.S. utilized the U.S.-Japan Semiconductor Agreement and pressure on exchange rates and trade to dismantle Japan’s dominance in the global memory semiconductor market at the time.

Nikkei and the Sankei Shimbun added that the memory market is notoriously difficult to forecast in terms of supply and demand, and that misjudged investment decisions could lead to massive losses.

Sankei noted that while the Korean semiconductor industry is planning large-scale investments in the hundreds of trillions of won, Japan’s leading semiconductor firm, Kioxia, plans to invest 1.41 trillion yen (approximately 13.2 trillion won) by 2028, or an annual average of 470 billion yen (approximately 4.4 trillion won)—an annual average investment 10% lower than its previous peak annual investment.

The newspaper noted that while the memory industry’s chronic cycle of boom and bust must be considered, some argue that the market has entered a "super cycle" where demand continues to grow due to the explosive adoption of AI, raising concerns that the Japanese industry might be missing an opportunity.

Meanwhile, local media reported that Kioxia, a NAND flash manufacturer competing for the top spot in market capitalization on the Japanese stock market, has set a goal to overtake Samsung Electronics and SK Hynix, the world’s top two players in NAND flash market share.

It was belatedly reported that Kioxia President Hiroo Ota stated at a shareholders' meeting held on June 25, "We invented NAND flash, but we are not number one. I don't know how many years it will take, but we will reclaim the top spot."

Nikkei remarked that "Kioxia's counterattack has begun," but also pointed out, "Even if it has risen to the top tier in terms of Japanese market capitalization, Samsung and SK Hynix boast corporate valuations four times that of Kioxia. Kioxia faces a mountain of challenges, including strengthening relationships with major clients like U.S.-based Nvidia, developing advanced technologies, and making bold capital investments."