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Samsung Electronics Projected to Rise to No. 2 in Global Foundry Market This Year
Samsung Challenges Market Leader TSMC
Samsung Electronics Projected to Rise to No. 2 in Global Foundry Market This Year
  • By Kim Eun-jin
  • October 30, 2018, 10:02
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Samsung Electronics is expected to secure the second place in the global foundry market this year with sales of more than $10 billion (about 11.4 trillion won).

Samsung Electronics is expected to secure the second place in the global foundry market this year with sales of more than $10 billion (about 11.4 trillion won). In a recent paid report, which was not disclosed to the public, market research firm IC Insights put Samsung Electronics after TSMC, a Taiwanese company that leads the market.

For Samsung, which sold memory semiconductors worth 74 trillion won (US$66 billion) last year, foundry has become one of the three main sources of income together with memory semiconductors and system LSI. Last year, the company’s foundry business posted sales of US$4.6 billion, ranking 4th in the industry with a market share of 6%.

Samsung’s market share is believed to have exceeded 14% this year, as the foundry division’s production of Exynos mobile processors for the smartphone division are counted as sales. Samsung Electronics separated the foundry business division from the system LSI division in May last year.

Some analysts say that Samsung’s rise to the second place in the global foundry business this year is nothing more than an illusion created by the separation of the foundry division from the system LSI division. However, some analysts predict that starting from next year, Samsung’s foundry business will grow rapidly by winning ASIC contracts from a number of virtual money developers and supplying application processors (APs) to Qualcomm and Apple.

In particular, industry analysts note that Samsung Electronics has applied extreme ultraviolet (EUV) technology to 7 nm processes for the first time in the world. At the moment, the industry-leading TSMC is the only company that has a 7 nm process foundry, and it plans to introduce EUV next year.

EUV equipment is known to cost up to several hundred billion won per unit, but it can support a 3 nm process at a time. As it offers a much faster production speed than the past method of drawing semiconductor circuit lines several times, it gives advantage to the company in securing competitiveness.

In addition, Samsung Electronics is seeking to improve the utilization of EUV by applying it to the 10-nm DRAM production line. Analysts say that this will increase the reliability of Samsung’s 7 nm foundry while at the same time increasing its competitiveness in DRAM production.

Meanwhile, the global foundry market last year was US$62.31 billion (about 71 trillion won), which is bigger than the NAND flash market (about US$54 billion). Market research firm IHS Markit foresees that the average annual growth rate of the foundry market (7.8%) will surpass DRAM (5.3%) and NAND flash (6.1%) by 2021.