Samsung Electronics Expands Chip Manufacturing Business
Samsung’s Roadmap for Chip Manufacturing Expansion
Samsung Electronics recently announced its plans to expand its chip manufacturing business, focusing on leading-edge semiconductors. The company aims to catch up with industry leader TSMC.
Samsung’s Semiconductor Business
Samsung is well-known for its smartphones, but its semiconductor business serves as its primary profit driver. The company manufactures memory chips used in data centers and laptops.
Additionally, Samsung operates a chip manufacturing business known as a foundry. This division produces semiconductors for other companies, such as Qualcomm, that design chips.
The 2 Nanometer Process
Samsung initially announced its plans to start making chips using a 2 nanometer process in 2025. Now, the company has provided a more detailed roadmap:
- In 2025: Mass production of 2nm chips for mobile applications
- In 2026: Expansion to high-performance computing
- In 2027: Expansion to automotive
The Significance of Nanometer Size
The nanometer measurement indicates the size of each individual transistor on a chip. Smaller transistors allow for a higher density of transistors, resulting in more powerful and efficient chips. Apple’s latest iPhone processor, for example, uses a 5nm process.
Considering the increasing demand for advanced chips in smartphones, Samsung is preparing for the future by focusing on developing more advanced chips by 2025.
Targeting High-Performance Computing
Samsung plans to enter the high-performance computing segment, which involves producing chips for data centers that train and deploy artificial intelligence applications. The company aims to capitalize on the technology’s growth, driven in part by the popularity of OpenAI’s ChatGPT. Nvidia, a market leader in AI chips, currently relies on foundries like TSMC for semiconductor manufacturing.
Samsung’s Position in the Semiconductor Market
Samsung’s foundry business lags behind Taiwan’s TSMC, the largest contract manufacturer in the world. In the first quarter of this year, TSMC accounted for 59% of global semiconductor foundry revenue, while Samsung held a mere 13%, according to Counterpoint Research.
To bridge this gap, Samsung aims to increase its manufacturing capacity and has outlined its plans for growth in high-demand areas within the chip market.
Future Developments and Capacity Expansion
Samsung remains committed to its planned 1.4nm process, set for implementation in 2027.
The company is also actively expanding its chip manufacturing capacity. It has previously announced new manufacturing lines in Pyeongtaek, South Korea, and Taylor, Texas.