Tech Newsround – Samsung and Wayve

Samsung: The best is ahead?  

• Samsung has guided for an excellent recovery in semiconductors, and with a deal signed with OpenAI and market share gains in HBM memory still to come, I suspect that the recovery is not yet complete.
• Q3 2025 revenues / EBIT will be KRW85tn – KRW87tn / KRW12.0tn – KRW12.2tn, nicely ahead of expectations and where the full results will be published on October 30.
• This is nicely ahead of expectations, which were for operating profit of KRW9.7tn, but as usual, news of this had already percolated out into the local market, which is one reason why the shares have already run hard into this announcement.
• The other is the prospect of qualifying as a supplier to Nvidia of 4^th generation high bandwidth memory (HBM) that will be required in H2 2026.
• The samples of HBM4 have been shipped, and I think it is likely that Samsung will receive approval from Nvidia in Q1 2026.
• This is further supported by the recent visit of Sam Altman to Korea, where Samsung and SK Hynix both signed a letter of intent with OpenAI to supply memory to the $500bn Stargate project.
• Hence, while the shares have rallied strongly, I suspect that there is further to go as the valuation remains very unchallenging.
• Samsung is currently trading on 13x 2026 and 11.1x 2027 PER, and I suspect that the consensus estimate remains too low given how much money is pouring into building AI datacentres in which Samsung will finally participate.
• Hence, I think an expansion of the multiple as well as earnings upgrades are on the cards, which takes my valuation to around KRW133,000 per share ($2,354 on the GDR).
• I have held Samsung for a few quarters now and remain very comfortable to sit tight.

Wayve: The wrong tree  

• Wayve, the UK-based autonomous driving start-up, is raising money at $8bn as a result of investor appetite rather than need, but I continue to think that Wayve will struggle to produce a commercial product worthy of the expectations that it has set.
• Wayve is a UK-based autonomous driving start-up that uses a single large end-to-end model to drive the vehicle.
• This means that sensor data goes in one end and driving instructions to the vehicle pop out the other.
• The advantage of this is that if one can get to work, then there is no need to limit where the vehicle can go, which also means that an HD map will not be needed.
• This is ironic as the map makers currently tell me that they are seeing a lot of interest from autonomous driving companies that claim not to use a map.
• To me, this is an admission that there are some fundamental drawbacks to this approach to autonomous driving and reinforces my long-held position that an end-to-end approach will not produce a commercially viable, fully autonomous vehicle.
• This tells me that Wayve and the other autonomous driving companies that are using this approach are barking up the wrong tree.
• One can see this in how Nissan will be using Wayve’s technology starting in 2027, where it will be used for level 2 only at the outset.
• Level 2 is hands-on ADAS, where the human is still piloting the vehicle and does not go much beyond staying in lane and adaptive cruise control.
• I take this to be a signal of a “let’s see” approach, and I suspect that as SoftBank is a major investor in Wayve and is championing a collaboration between OEMs to share data and resources to achieve full autonomy with an end-to-end system, it has had some influence on Nissan when it came to taking software from Wayve.
• Nissan has made no commitment that I can see to take this beyond level 2, and so I do not take this as a sign that the end-to-end large model approach is the right one.
• In fact, I think this approach will end up falling short, and an approach that uses a combination of rules-based software and machine learning will be the one that wins out at the end of the day.
• This also means that autonomous driving components such as an HD map, lidar, radar and cameras will all be needed to help reduce the volatility of the dataset of the road as well as produce the redundancy that can make the cars safer than humans.
• With all of the hype and excitement around LLMs, this approach is currently not in favour, and so I suspect that it will be later rather than sooner that we begin to see fully autonomous vehicles on the road.
• By raising money when it doesn’t need it, Wayve is signalling to the market that its equity is worth less than the cash that it is receiving from investors, which is a sentiment with which I wholeheartedly agree.