In the second half of this year, Samsung began mass production of its Gate-All-Around (GAA) second-generation 3nm process. However, due to unstable yields, this process has failed to win over customers. This technical issue has cast a shadow over the company's efforts to compete with industry leader TSMC, which held a market share of 62.3% in the second quarter, while Samsung only managed 11.5%.
On October 24, Samsung Electronics will hold an online foundry forum, a move that reflects the difficult situation of its foundry business. Around mid-October, the company will also announce the performance of its various business sectors for the third quarter. The securities industry predicts that non-memory business sectors, including foundry and system LSI, will continue to struggle, with expected operating losses reaching 500 billion won (approximately $385 million).
According to global market research firm TrendForce, Samsung Electronics ranked second in the second quarter with an 11.5% market share, while*widened the gap to 50.8 percentage points.
Compounding Samsung's difficulties, the yield rate for the Exynos 2500 chips produced using the GAA 3nm process is very low, making it uncertain whether the Galaxy S25 series can utilize this chip next year. The 2nm process also faces delays, complicating Samsung's technology roadmap further.
Major global tech companies like Nvidia and Apple have announced foundry collaborations with TSMC, making it challenging for Samsung to secure similar high-profile customers. Recently, there have been internal rumors about reallocating some staff working in the foundry division to the memory business sector. There are external suggestions for Samsung Electronics to spin off its foundry business.
Samsung Securities has been emphasizing the necessity of strategic change. A representative stated, "As the foundry business needs to maintain closer ties with clients, proactive localization (such as establishing more factories in the U.S.) is essential." They further suggested that Samsung Electronics consider "spinning off the foundry business and listing it in the U.S."
Experts have differing opinions on the potential spin-off. One expert noted, "Separating the foundry business is a strategic choice for the company, and it is difficult to predict any possibilities or impacts."
However, Samsung Electronics Chairman Lee Jae-Yong stated on October 7 that the company has no intention of divesting its contract chip manufacturing business (i.e., foundry) or its logic chip design business.
