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Samsung Foundry is anticipated to see significant growth in the coming quarters, as production lines are reporting a substantial increase in utilization rates.
Samsung’s Chip Business to See a Massive Rebound, as Mature Nodes See Higher Adoption Rates
The Korean tech giant has endured challenging quarters with its foundry division due to large investments that didn’t yield much return, leading to significant operating losses. However, the momentum appears to be returning for Samsung, according to a report by Chosun Biz, which indicates that production lines are recovering, particularly for mature nodes like 4nm and below. The firm had been facing substantial losses with older processes, but it seems the annual deficit is expected to decrease significantly.
Nodes such as 4nm, 5nm, and 8nm have seen utilization rates well above 50%, largely driven by contracts with Nintendo, along with Samsung’s development of the next-generation HBM4 process using the 4nm process for the base die. Additional demand is coming from the System LSI division and the production of crypto-mining ASICs for Chinese customers.
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Samsung Foundry is expected to reduce its deficit significantly. Following the $16.5 billion deal with Tesla for AI6 chips, the firm is anticipated to receive a surge of orders from the industry. Samsung aims to secure 2nm orders from NVIDIA, Qualcomm, and other tech giants, and with approval from Elon Musk’s Tesla, it has a better chance of acquiring more business from other customers. While catching up with TSMC will take considerable time for the Korean giant, the firm appears to be on the right path.
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📚 Reading Comprehension Quiz
According to the passage, which factor is driving the significant increase in utilization rates for Samsung's production lines?
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