Samsung Foundry is expected to see immense growth moving into the upcoming quarters, as the company's production lines are reporting a huge increase in utilization rates.
Samsung's Chip Business To See a Massive Rebound, As Mature Nodes See Higher Adoption Rates
The Korean giant has had a tough few quarters with the foundry division, especially since the massive investments didn't yield much return, leading to huge operating losses. However, it seems like the momentum is back with Samsung for now, as according to a report by Chosun Biz, it is revealed that Samsung's production lines are recovering, especially for mature nodes like 4nm and below. The more important thing is that the firm had been facing massive losses with older processes, but it seems like the annual deficit is expected to shrink by a decent margin.
It is claimed that nodes such as 4nm, 5nm, and 8nm and their respective production lines have seen utilization rates much higher than 50%. This is mainly driven by the company's contracts with Nintendo, along with how the Korean giant is developing the next-gen HBM4 process, which uses the 4nm process for the base die. Apart from this, demand is coming from the company's System LSI division and developing crypto-mining ASICs for Chinese customers.
Samsung Foundry is expected to reduce its deficit aggressively. More importantly, after the massive $16.5 billion deal with Tesla for their AI6 chips, the firm is expected to see massive order momentum from the industry. Samsung is in pursuit of grabbing 2nm orders from NVIDIA, Qualcomm, and many other tech giants, and after the approval by Elon Musk's Tesla, the firm has a better chance of grabbing orders from other customers. While coming on par with TSMC will take a lot of time for the Korean giant, it seems like the firm is headed in the right direction.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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