Nvidia’s HBM4 Dual-Source Shift: Samsung Challenges SK Hynix Pricing Power

The establishment of a dual-source HBM4 supply chain for Nvidia’s Vera Rubin platform represents a pivotal shift in the AI memory market, breaking SK Hynix’s near-monopoly and introducing new pricing dynamics.

🔑 Key Points

• SK Hynix’s Monopoly Broken: Nvidia has established a preliminary 70/30 supply split for its Rubin (R100) GPUs, with SK Hynix retaining the majority share (~70%) and Samsung securing a critical foothold (~30%), while Micron has reportedly been excluded from the initial HBM4 allocation.
• Pricing Power Under Siege: While SK Hynix targets a 30–40% price premium for HBM4 to offset higher production costs, Samsung’s aggressive re-entry strategy—leveraging its massive manufacturing capacity to target price parity—is expected to cap these premiums and prevent the "seller’s market" seen with HBM3E.
• The "Vera" vs. "Rubin" Nuance: The supply chain is effectively bifurcated by chip type; while the Rubin GPU relies on HBM4 from the Korean duopoly, the accompanying Vera CPU utilizes LPDDR5X, a market where Micron remains a key player, creating a complex, multi-layered supplier ecosystem.

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1. The 70/30 Supply Chain: Breaking the Monopoly

For the first time in the generative AI era, Nvidia has successfully diversified its most critical component supply chain before a platform launch. The "Vera Rubin" platform—specifically the flagship VR200 NVL72 rack-scale system—will not rely solely on SK Hynix.

1.1 The Allocation Split

As of early 2026, industry reports indicate a firm dual-source structure for the HBM4 modules used in the Rubin R100 GPU:

• SK Hynix (~70% Share): Remains the "anchor" supplier. Nvidia prizes SK Hynix’s superior yield rates (approaching 90%) and established reliability. They are expected to supply the initial wave of premium "Rubin Ultra" chips and the majority of the high-performance NVL72 rack configurations.
• Samsung Electronics (~30% Share): Has successfully qualified its HBM4, utilizing its 1c (10nm-class) DRAM process. This 30% allocation is not just "overflow" capacity; it is a strategic hedge by Nvidia to ensure volume scalability that SK Hynix cannot meet alone.

1.2 Micron’s Exclusion

A key "expert insight" often missed in broader reporting is Micron’s position. While a major player in HBM3E, Micron has reportedly effectively "dropped out" of the initial HBM4 race for Rubin due to performance and capacity constraints. However, they remain vital to the platform’s Vera CPU, which uses LPDDR5X memory, creating a distinct "memory tier" where they can still compete.

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2. Impact on HBM Pricing Premiums

The arrival of a viable second source fundamentally alters the pricing power dynamic. SK Hynix is attempting to maintain the high-margin environment of 2024–2025, while Samsung is incentivized to disrupt it.

2.1 The "Premium" vs. "Parity" Conflict

2.2 Erosion of SK Hynix’s Pricing Power

SK Hynix’s ability to dictate terms is significantly weaker than during the HBM3 era.

• Cap on Premiums: With Samsung able to supply nearly a third of the required volume, Nvidia has leverage to reject excessive price hikes. Analysts predict that while HBM4 will still command a premium due to manufacturing complexity, the "scarcity tax" SK Hynix previously enjoyed will evaporate.
• The "Game of Chicken": Samsung has a larger total wafer capacity (approx. 3x that of SK Hynix). If Samsung decides to flood the market to maximize utilization, it could force a market-wide price correction, preventing SK Hynix from passing on the full cost of its new TSMC collaboration.

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3. Technical Divergence & Strategic Implications

The dual-sourcing strategy is also a hedge against technical risk, as the two giants are taking radically different manufacturing paths for HBM4.

3.1 Divergent Manufacturing Paths

• SK Hynix (The TSMC Alliance): SK Hynix has partnered with TSMC to manufacture the HBM4 base die using TSMC’s 12FFC+ (and eventually 5nm) logic processes. This creates a "best-of-breed" product but significantly increases cost and supply chain complexity.
• Samsung (The Turnkey Solution): Samsung is using its internal foundry (4nm process) for the base die and its own memory fabs for the DRAM layers. This "turnkey" approach eliminates third-party margins (like TSMC’s), theoretically giving Samsung a cost structure advantage that supports its aggressive pricing strategy.

3.2 Supply Security for Nvidia

By validating both the "TSMC + SK Hynix" and "All-Samsung" methodologies, Nvidia insulates itself from single-point failures. If TSMC’s CoWoS capacity faces bottlenecks (a recurring issue), Samsung’s self-contained supply chain offers a fail-safe that was unavailable during the Blackwell generation.

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4. The "DDR5 Squeeze": A Cascading Market Effect

A critical secondary effect of this HBM4 battle is the impact on the standard memory market.

• Capacity Cannibalization: To meet the aggressive HBM4 volume targets (which consumes 3x more wafer capacity than standard DRAM), both suppliers are shifting lines away from DDR5.
• DDR5 Price Surge: As a result, the price of standard DDR5 server memory is projected to surge in 2026. While Nvidia secures HBM4 stability, the broader server market (CPUs, standard hyperscale blades) will likely face a severe supply crunch, driving up costs for data centers outside of the AI rack itself.

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📚 Recommended Topics for Further Exploration

• The "Rubin Ultra" Timeline: How supply allocations might shift for the 2027 "Ultra" refresh if Samsung improves its yield.
• HBM4E and Hybrid Bonding: The next technical hurdle (expected late 2027) where the manufacturing difficulty spikes again, potentially resetting the competitive landscape.
• Custom HBM (C-HBM): The trend of hyperscalers (Google, AWS) designing custom base dies for HBM4, and how this reduces the memory vendor’s leverage.