[Chip Talk] Samsung Foundry Surpasses Turnaround... Betting on Memory and Non-Memory Synergy

Vision for a Comprehensive Semiconductor Company
Confidence Soars with a Series of Global Orders
Synergy from Memory and Non-Memory Integration Accelerates
Foundry Technology at the Core of Strategic Expansion
Proving Technological Prowess with Tesla AI Chip Orders
Exynos 2600 Signals the Revival of In-House APs
Differentiation with HBM4 Base Die Using 4-Nanometer Process
Head-to-Head 2-Nanometer Process Competition with TSMC
Maximizing Performance and Power Efficiency with GAA Technology
Market Counterattack through Yield Improvement and Pricing Strategy

Samsung Electronics is setting its sights on a new leap forward in the foundry (semiconductor contract manufacturing) sector, aiming for a turnaround and beyond. The company has recently secured a series of orders from global corporations, and it is openly expressing its ambition to leverage the technological capabilities recognized in this process as a "master key" for future growth. At the core of this ambition is the plan to realize various strategies that combine the non-memory foundry business with its memory business to create synergy effects. These efforts are beginning to yield tangible results, drawing increasing attention from the industry.

At the opening ceremony of the "Semiconductor Exhibition (SEDEX) 2025" held at COEX in Gangnam-gu, Seoul, on the 22nd of last month, Song Jaehyuk, Chief Technology Officer (CTO) of Samsung Electronics, expressed strong confidence in the collaboration between memory and non-memory sectors. Taking the stage as a keynote speaker, he stated, "There were times when I thought it was a burden for Samsung to be the only company in the world with DRAM, NAND, system semiconductors, and packaging capabilities," adding, "I believe that a company with a diverse range of specialties can create even greater synergy." Just as Moore's Law states that the performance of integrated circuits doubles approximately every two years, Song emphasized that the current evolution of semiconductor technology is not confined to a single field. Instead, the development of DRAM, NAND, system semiconductors, and packaging is happening across boundaries, and now is the time to challenge the evolution of memory by utilizing the non-memory sector. Samsung intends to use its foundry business as the key weapon in this endeavor.

Confidence in Broad Applications of Foundry Technology

Looking at Samsung Electronics' exhibition booth at the 27th Semiconductor Exhibition, which opened on the 22nd and ran through the 24th at COEX in Seoul, it was clear that the foundry business was an indispensable theme. While the foundry may not have been the main theme in terms of exhibition layout, it certainly occupied a significant portion of the space. Most of the flagship technologies Samsung showcased throughout the exhibition were based on its foundry capabilities.

Samsung is integrating foundry technology across various business areas, and the technology itself is widely regarded as having advanced significantly. The automotive process that captured Tesla's attention is a prime example. At the exhibition, Samsung promoted its automotive foundry process technology through a video and a detailed table. The key message was that Samsung's automotive process technology spans a wide range of nodes, from 14-nanometer (nm, one-billionth of a meter) to 2-nanometer, achieving both diversity and miniaturization. With this technology, Samsung signed a contract in July to supply Tesla with artificial intelligence (AI) chips worth 22.8 trillion won. The core of the contract is to manufacture Tesla's high-performance "AI6" chips, which Samsung is reportedly planning to produce using the 2-nanometer process. Additionally, Tesla recently decided to have Samsung, along with TSMC, participate in the production of its AI5 chips.

Another achievement highlighting the foundry's strengths is the decision to equip next year's Galaxy S26 series with the Exynos 2600 mobile application processor (AP). As a smartphone manufacturer, Samsung has long considered the in-house development and integration of APs a key challenge, and the foundry division has worked to address this. Developing its own APs is a shortcut to reducing smartphone production costs and achieving technological independence from overseas suppliers. After a series of trials and errors, Samsung finally succeeded with the Exynos 2600. At the exhibition, the company displayed the previous-generation Exynos 2500 and introduced related technologies.

Song Jaehyuk, Chief Technology Officer (CTO) of Samsung Electronics, delivered the keynote speech on the theme "Semiconductor Innovation through Synergy" at "Semiconductor Exhibition (SEDEX) 2025" held on the 22nd of last month at COEX in Gangnam-gu, Seoul. Photo by Yonhap News Agency

At this exhibition, Samsung unveiled the actual 12-stack product of the sixth-generation High Bandwidth Memory (HBM4) to the Korean public for the first time, and also promoted the fact that the base die of HBM4 is manufactured using its own 4-nanometer foundry process. The base die is a kind of "foundation" at the bottom of HBM, responsible for memory operation control and data distribution. Starting with HBM4, the base die has taken on a more active role, such as improving AI computation efficiency and energy management, prompting companies to be more prudent in choosing their base die production processes. Samsung has decided to manufacture the base die using its 4-nanometer foundry, differentiating itself from other companies that outsource base die production to Taiwan's TSMC. To emphasize this point, Samsung installed a separate video explaining the details, apart from the HBM4 display.

The Intensifying 2-Nanometer Competition Is the Decisive Battleground

The global foundry competition is increasingly shifting toward the 2-nanometer node. In addition to Samsung, TSMC (Taiwan), Intel (United States), and more recently Rapidus (Japan) are joining the fray, intensifying the competition to attract customers. Industry analysts predict that Samsung will offer relatively lower prices to customers in response to TSMC, which has raised its prices starting from the 2-nanometer process. If Samsung can secure high yield rates and maintain technological superiority, it is expected to have a strong chance of success. The fact that some global companies, including Tesla, are seeking to counter TSMC's monopoly also works in Samsung's favor.

According to industry sources, Samsung's 2-nanometer process is reported to deliver a 12% performance improvement and about 25% better power efficiency compared to the existing 3-nanometer process. Yield rates are said to be approaching 40-50%. The adoption of the gate-all-around (GAA) structure is also cited as a strength. This technology surrounds all four sides of the channel through which current flows in a transistor, allowing for more precise current control and significantly improved power efficiency compared to the previous FinFET technology. It also enables transistors to function reliably at smaller sizes. Samsung was the first in the world to apply this technology to the 3-nanometer process in 2022. If successful at 2 nanometers, Samsung could not only attract many more customers but also further enhance its memory technology, laying the groundwork for its vision of becoming a "comprehensive company" operating across all semiconductor sectors. Accordingly, Samsung is likely to make a decisive push to win in the 2-nanometer race, capitalizing on the current momentum in the foundry business.