- Samsung outlines an ambitious strategy to escalate its chip production, targeting mobile applications, high-performance computing, and automotive sectors between 2025 and 2027.
- Despite trailing Taiwan Semiconductor Manufacturing Co., Samsung is set on increasing its global semiconductor foundry share from 13% by boosting its manufacturing capacity.
- With new production lines in Pyeongtaek, South Korea, and Taylor, Texas, Samsung stays on course with its initial plan to initiate a 1.4-nm chip manufacturing process by 2027.
On a bright Wednesday, Samsung Electronics, the titan of South Korean tech, mapped out an ambitious plan to escalate its semiconductor production, aiming to stand toe-to-toe with the current market leader, Taiwan Semiconductor Manufacturing Co.
While many might recognize Samsung for its renowned smartphones, the company's main source of profits resides in its mammoth semiconductor segment. These chips, the unsung heroes of technology, form the backbone of laptops and data centers worldwide.
A lesser-known facet of Samsung's expansive operation is its chip foundry service, manufacturing high-quality semiconductors for other chip-designing companies such as Qualcomm.
Earlier, Samsung had shared its plans to start manufacturing chips employing an ultra-advanced 2-nanometer process by 2025. Now, the company offers a clearer picture: they'll start mass-producing these chips for mobile applications in 2025, broadening its focus to high-performance computing in 2026 and finally entering the automotive sector by 2027. The nanometer measurement, indicative of transistor size on a chip, tells us that Samsung is pushing boundaries, aiming for smaller, more efficient, and power-packed chips.
To put things into perspective, Apple's most recent iPhone processor uses a 5-nm process. As smartphones continue to demand more advanced chips, Samsung plans to be ready for the challenge by 2025.
The term 'high-performance computing' encapsulates chips designed for data centers to train and implement artificial intelligence applications. Samsung seeks to tap into the growing AI market, partly driven by the success of platforms like OpenAI's ChatGPT. Market leaders in AI chips like Nvidia rely on foundries such as TSMC to produce their semiconductors.
Samsung's foundry business, while significant, lags behind TSMC, the world's leading contract manufacturer. A study by Counterpoint Research highlighted this gap, revealing that TSMC accounted for 59% of global semiconductor foundry revenue in Q1, compared to Samsung's 13%.
Undeterred, Samsung aims to close this gap by increasing its capacity and laying out a strategic plan targeting high-growth areas within the chip market. They maintain that the 1.4-nm process will kick off in 2027 as initially proposed.
Finally, Samsung stated its continuous expansion in chip manufacturing capacity with new production lines in Pyeongtaek, South Korea, and Taylor, Texas, as previously announced.
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