Samsung Electronics ignited a stunning rally on South Korea's KOSPI index to start 2026, with shares surging 7.17% to close at 128,500 won—the first time the tech giant has crossed the 120,000 won threshold. The gains propelled the benchmark Korean stock index to an all-time high of 4,309.63, breaking through the psychologically significant 4,300 level.

The catalyst for Samsung's resurgence was a New Year address from Vice Chairman Jun Young-hyun that electrified investors with three simple words: "Samsung is back."

The HBM4 Breakthrough

At the heart of Samsung's renewed optimism is progress on HBM4, or fourth-generation high-bandwidth memory—the critical component powering artificial intelligence accelerators. Jun revealed that Samsung is in active discussions to supply these advanced memory chips to Nvidia, potentially restoring a partnership that had cooled as rival SK hynix captured the lion's share of AI memory orders.

"We will restore our fundamental technological competitiveness. Samsung is back."

— Jun Young-hyun, Samsung Electronics Vice Chairman

HBM chips are essential for AI workloads because they stack multiple layers of DRAM dies vertically, connected by thousands of through-silicon vias. This architecture enables the massive memory bandwidth that large language models and neural networks require. As AI training clusters grow larger, demand for HBM has exploded—and Samsung has been racing to close the gap with SK hynix.

A Broader Korean Rally

Samsung wasn't alone in its advance. SK hynix, the current HBM market leader, also hit record highs, closing above 670,000 won per share. The semiconductor sector's strength lifted the entire Korean market, with foreign investors contributing 644.7 billion won in net purchases.

The KOSPI's move past 4,300 marked the first time the index has closed at that level, surpassing its previous record of 4,221.87 set in November 2025. The rally reflects growing confidence that Korean chipmakers will capture outsize benefits from the continued AI infrastructure buildout.

Key Drivers of the Korean Rally

  • AI demand surge: Global hyperscalers continue expanding AI capacity, driving memory chip demand
  • Samsung turnaround: HBM4 progress signals potential market share recovery
  • Valuation reset: Korean chips had lagged Taiwanese peers, creating catch-up potential
  • Foreign inflows: International investors rotated back into Korean equities

The AI Memory Landscape

The AI memory market has become one of the most consequential battlegrounds in the semiconductor industry. SK hynix has dominated HBM3 and HBM3E supply to Nvidia, capturing the majority of orders for chips used in the H100 and upcoming Blackwell platforms.

Samsung's HBM4 push represents an attempt to leapfrog the competition on next-generation technology. The company's foundry and logic divisions have also been working to improve yields and performance, addressing quality concerns that some analysts say contributed to Samsung falling behind.

Why HBM4 Matters

HBM4 promises several advances over current-generation chips:

  • Higher bandwidth: Expected to exceed 1.5 TB/s per stack
  • Increased capacity: Larger memory configurations for bigger AI models
  • Better power efficiency: Critical for data center economics
  • Advanced packaging: New interconnect technologies for improved performance

If Samsung can deliver competitive HBM4 products and secure Nvidia orders, it could recapture billions of dollars in revenue that has flowed to SK hynix over the past two years.

Analyst Upgrades Follow

Wall Street and Korean brokerages moved quickly to respond to Samsung's revitalized outlook. IBK Investment & Securities raised its target price for Samsung Electronics to 155,000 won, citing expectations for "record earnings in 2026."

The upgrade reflects optimism that Samsung can execute on multiple fronts simultaneously:

  • Memory: HBM4 and improved DRAM/NAND market conditions
  • Foundry: New process nodes attracting design wins
  • Display: OLED technology leadership in mobile and TV
  • Consumer electronics: Galaxy smartphone franchise maintaining share

Broader Asian Market Strength

Samsung's surge contributed to a strong start for Asian markets overall. Hong Kong's Hang Seng jumped 2.6% to 26,283.53, with Alibaba climbing 3.7% and Baidu surging 9.5% after announcing plans to spin off its AI chip unit Kunlunxin.

The technology-led rally across Asia reflects renewed investor appetite for AI beneficiaries as 2026 begins. With the Consumer Electronics Show opening in Las Vegas, market attention remains focused on artificial intelligence developments that could drive the next leg of growth.

Risks and Considerations

Despite the euphoric start to 2026, Samsung faces challenges that could temper the rally:

  • Execution risk: HBM4 promises must be followed by actual deliveries
  • Competitive pressure: SK hynix continues advancing its own roadmap
  • China exposure: Geopolitical tensions could impact a significant revenue source
  • Memory cyclicality: The industry remains vulnerable to supply-demand swings

The Bottom Line

Samsung Electronics' record-breaking rally signals a potential turning point for the company and Korean equities broadly. Vice Chairman Jun's declaration that "Samsung is back" resonated because it acknowledged the company's recent struggles while projecting confidence in its technological roadmap.

For investors, the question is whether Samsung can translate HBM4 progress into market share gains and sustained outperformance. The early 2026 rally suggests the market is willing to give Samsung the benefit of the doubt—but execution over the coming quarters will determine whether this optimism is warranted.

As the AI infrastructure buildout continues, memory chip suppliers like Samsung and SK hynix sit at the center of one of the most important technology trends of the decade. Samsung's resurgence could reshape the competitive landscape and provide investors with a compelling alternative to pure-play AI beneficiaries in the U.S. market.