South Korea's gross domestic product expanded 1.3% quarter-on-quarter in Q1, the Bank of Korea reported Wednesday, comfortably above the 0.9% consensus and a meaningful acceleration from the 0.5% growth recorded in Q4 2025. Year-on-year GDP growth came in at 3.4%, the fastest reading since Q1 2022. The print was lifted by surging semiconductor exports, which contributed an estimated 0.7 percentage points to headline growth.
Total goods exports grew 11% year-on-year to $185 billion in the quarter, with semiconductors alone accounting for $47 billion (+34%). High-bandwidth memory (HBM) shipments — the supply-constrained product class essential to Nvidia's H200 and B200 GPUs — drove the upside, with both Samsung Electronics (005930.KS) and SK Hynix (000660.KS) running production at full utilization. Shipbuilding orders to LNG carrier construction added a further 1.2 percentage points of export-volume growth.
Samsung HBM3E Qualification Milestone
A pivotal development was Samsung's formal qualification with Nvidia for HBM3E 12-Hi, announced last week, ending a year-long competitive disadvantage versus SK Hynix. Samsung's HBM revenue is forecast to triple in 2026 to roughly $24 billion, contributing 28% of memory-segment operating profit. Industry consultancy TrendForce expects HBM4 — slated to launch with Nvidia's Rubin platform in late 2026 — to be co-supplied across all three Korean and Taiwanese fabs.
On a separate front, Hyundai Motor Group (005380.KS) and Kia Corp (000270.KS) reported combined Q1 vehicle deliveries of 1.74 million units, up 6% year-on-year. The U.S. market, which absorbed 470,000 units (+4%), continues to be the dominant growth driver. Hyundai management on its conference call emphasized that recently announced 25% U.S. tariffs on imported vehicles "would significantly impact our 2026 U.S. revenue outlook" if maintained at the current rate; Hyundai is accelerating its Metaplant America capacity build to mitigate.