Samsung’s foundry division is facing serious challenges, with little positive news in sight. The company is struggling with poor yield rates for its 3nm and 2nm processes, damaging its reputation and causing a sharp decline in market share — while TSMC continues to dominate, securing massive chip orders from all major global clients. Adding to the uncertainty, rumors are circulating that Samsung might shut down its foundry unit.
There is also speculation about transferring the Exynos team to the smartphone division, though MX Division Head TM Roh strongly opposes the move. The situation remains fluid, and the coming months will be crucial in determining Samsung’s semiconductor strategy.
Samsung Foundry’s future remains uncertain amid yield struggles
Rumors are swirling that Samsung might cancel its SF1.4 (1.4nm) process node previously expected to enter mass production by the end of 2027. This raises concerns about the future of Samsung Foundry. The company started 3nm mass production in 2022 but has yet to commercially launch a 3nm smartphone chip. Its 2nm node is facing similar yield challenges.
On the other hand, TSMC has been able to secure healthier 3nm and 2nm yields. While both firms are yet to start 2nm mass production, TSMC comfortably outperformed Samsung in the 3nm era, despite it starting 3nm mass production several months later. It appears Samsung has lost all hope and might shut down the foundry business altogether.
Its semiconductor division still wants to develop in-house Exynos processors for Galaxy phones. However, with no in-house foundry, Samsung must rely on TSMC to manufacture those chips. Unfortunately, the Taiwanese firm backed out of such a deal, which puts question marks over the future of the whole semiconductor business, not just the foundry unit.
If the Exynos team stays on, Samsung might move it under the smartphone division. However, Samsung’s head of the smartphone division, TM Roh, is opposed to the move, signaling internal disagreements over the future of Exynos development. If SF1.4 is indeed scrapped, it could indicate deeper strategic shifts within the company’s semiconductor division. Whether this means a restructuring or a potential scale-down of Samsung Foundry remains to be seen.
