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Samsung Electronics Expanding Business in Foundry Market
Big Customers Place Orders on Samsung
Samsung Electronics Expanding Business in Foundry Market
  • By Kim Eun-jin
  • June 18, 2019, 09:12
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Samsung Electronics' share of the global foundry market is expected to expand in the second half of this year.

Samsung Electronics has recently received orders from Qualcomm and Nvidia, which are leading the global mobile application processor (AP) and graphic processing unit (GPU) markets. Samsung’s products to be supplied to the two companies are likely to be based on its extreme ultraviolet (EUV) 7 nm process. In addition, AMD, which is in strategic partnership with Samsung with regard to mobile graphic device supply, is expected to utilize Samsung’s foundry facilities in producing GPUs and central processing units (CPUs).

With Samsung Electronics working together with more and more giants in the global fabless industry, including IBM, its share in the global foundry market is expected to be boosted in the second half of this year.

Industry sources mention that Samsung’s recent successes in the market are attributable to its low-price strategy. “Samsung Electronics is aiming to top the global foundry market in 2030 and it seems that the company is currently focusing on client attraction rather than profitability in order to boost its market share,” one of them explained.

Market research firm TrendForce recently reported that TSMC is accounting for 49.2 percent of the global foundry market, followed by Samsung Electronics (18 percent), GlobalFoundries (8.7 percent), UMC (7.5 percent) and SMIC (5.1 percent). This quarter, the market has shrunk about 8 percent from a year ago to US$15.4 billion. The research firm said that the market would show a negative growth for the first time in 10 years this year due to the ongoing global economic recession and the growth rate for this year is estimated at negative 3 percent.

Samsung Electronics opted for market expansion instead of profitability in the shrinking market, and this implies competition will heat up in the global foundry industry. In response to Samsung’s aggressive marketing, TSMC is trying to defend its market share by supplying Apple with chipsets for next-generation iPhones.