Samsung Keeps Foundry Business, Eyes Stronger Chip Future

Samsung has hit some bumps in the road with its foundry business. Despite trying to catch up to TSMC, the company is struggling with poor yields, especially for its 3nm GAA wafers. Rumors swirled that Samsung might spin off its foundry and logic chip designing operations. But a Samsung executive has cleared the air, saying there are no such plans. The company's chairperson, Jay Y. Lee, acknowledges the challenges. Samsung's third-quarter earnings guidance is lower than expected, but Lee remains optimistic. He believes Samsung will overcome these obstacles and become the top semiconductor manufacturer by 2030.

Samsung has missed out on some big opportunities. It hasn't secured chip orders from NVIDIA, for instance. The company is set to mass produce high-bandwidth memory (HBM4) by the end of 2025, but it's still trailing SK hynix in supplying these chips for AI servers. Analysts estimate that Samsung's foundry and logic chip designing business could lose over $1.5 billion this year due to poor 3nm GAA yields. Some experts suggest the company might be better off spinning off these divisions to regain customer trust. However, this could be risky because these businesses might struggle without direct financial support from Samsung's memory arm. Recently, local companies have started favoring TSMC over Samsung for chip orders. Climbing out of this hole won't be easy for Samsung.

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