Samsung Home Appliances Takes Off in China, Domestic Components Enter High End Breakthrough Window Period

Recently, Samsung (China) officially announced the cessation of all home appliance sales in China, marking the complete end of the terminal retail business for this Korean giant that has been deeply involved in the Chinese market for decades. This event is not a simple market retreat, but a strategic cut by Samsung in the global industrial division of labor - divesting low margin terminal businesses and increasing its focus on high-end components such as storage chips and AI chips.

The decline of Samsung home appliances in China is an established fact. At its peak, Samsung TV had a market share of over 18% in the Chinese market, but by April 2026, its online/offline market share had fallen to 3.54% and 1.33% respectively, and its white goods market share was less than 0.5%. In 2025, Samsung's home appliance related departments will incur a total loss of approximately RMB 945 million. In sharp contrast, its semiconductor division contributed 93.4% of the company's operating profit in the first quarter of 2026, with revenue skyrocketing 225% year-on-year. In this context, Samsung is accelerating the divestment of its low gross profit and high competition home appliance business, and is fully shifting its resources to high-end component areas such as HBM high bandwidth memory and AI processors. Its strategic focus in China has also shifted from "terminal sales to Chinese consumers" to "semiconductor suppliers to the global industrial chain".

Samsung Home Appliances' exit will be the first to impact its supply chain in China, and the core component procurement pattern will be restructured. Its Suzhou home appliance factory has long purchased BOE, TCL Huaxing panels and MCU, power semiconductors and other components. After the suspension of domestic sales, the factory will transform into an export base, and the related domestic sales orders will be significantly reduced. Among them, high-end panels and variable frequency control chips are most affected, which will exacerbate the production capacity pressure in the panel industry in the short term. At the same time, low value-added orders such as mid to low end passive components will be prioritized for reduction, forcing small and medium-sized suppliers to transform; High end components are retained due to their adaptability to global export demand, but higher requirements are placed on suppliers. In addition, Samsung's home appliance production capacity has been transferred to Southeast Asia, but the local component industry is weak. Chinese manufacturers are expected to undertake some orders through export substitution, while also facing challenges such as tariffs.

After Samsung's exit, its high-end home appliance market share was released, freeing up space for local brands and directly driving the high-end penetration of domestic components. Chinese brands are accelerating the filling of high-end TV vacancies, with orders for high-end panels from BOE and TCL Huaxing increasing; After the synchronous exit of Samsung's display business, manufacturers such as Huike and Jichuang North quickly filled the gap, and the high-end penetration rate of domestic display chips is expected to exceed 40% by the end of the year. In the field of white goods, local brands are increasing their technological investment, driving the explosive demand for MCUs and power devices from companies such as Zhaoyi Innovation and Sida Semiconductor. The localization rate of home appliance MCUs is expected to increase to over 70%. After Samsung's SmartThings ecosystem withdrew from the AI home appliance market, the local ecosystem accelerated its dominance. AI chips and sensors from companies such as Ruixin Microelectronics and Geko Microelectronics quickly penetrated, driving domestic components to leap from low-end substitution to high-end dominance.

It should be clarified that Samsung's exit from the Chinese market does not mean Samsung's withdrawal from China. On the contrary, Samsung is accelerating its transformation into a core component supplier for China's electronics industry. Its Xi'an semiconductor factory (responsible for about 40% of the global NAND flash memory production capacity) and Tianjin MLCC factory are operating normally, and continue to increase investment - with a year-on-year increase of 67.5% in investment in the Xi'an factory by 2025, used to upgrade high-end storage production lines. In the future, Samsung's core role in China will shift to supplying core components such as storage chips, display driver ICs, and multi-layer ceramic capacitors to local terminal brands, forming a new competitive relationship of "Chinese terminals+Samsung components". This relationship involves both cooperation and competition: on the one hand, Samsung's technological barriers still constrain local supply chain security in some areas; On the other hand, the strong rise of Chinese terminal brands has also forced Samsung to make more concessions in terms of component supply prices, customized services, etc., thereby promoting the diversification of the domestic supply chain and the deepening of domestic substitution.

The exit of Samsung home appliances brings important insights to the local electronic components industry. Firstly, the decline in terminal demand is forcing resource concentration - the contraction of low gross profit businesses will encourage component manufacturers to actively abandon low-end internal competition and concentrate resources on more core areas such as high-end chips, sensors, and power modules. Secondly, localization is the core competitiveness, and component companies must deeply bind with rapidly rising local terminal brands, such as Hisense TCL、 Only by forming a close relationship of collaborative research and development and joint verification can Haier, Xiaomi, and others stand undefeated in the global supply chain restructuring. Furthermore, diversification of the supply chain has become inevitable. Whether it is Samsung's "exchanging components for the market" or the independent and controllable demand of Chinese brands, component manufacturers are required to balance the domestic market and global layout, rather than overly relying on a single customer or region. The withdrawal of Samsung home appliances is a microcosm of the profound restructuring of the global electronic industry division of labor.