To Meet Growing Demand

Samsung Electronics will expand its foundry capacity in legacy nodes.

Samsung Electronics will expand its foundry capacity in legacy nodes starting this year.

The move is aimed at securing new customers and boosting profitability by increasing the production capacity of mature processes for such items as CMOS image sensors (CISs), which are in growing demand due to a prolonged shortage.

At the same time, Samsung Electronics is planning to start volume production of advanced chips on its sub-3-nm fabrication process in the first half of this year.

The company said in its 2021 business report that it is considering expanding its matured node capacity in the mid to long term as demand is expected to continue to stay strong.

The company added it is taking steps to sharpen its product competitiveness and is closely considering building new fabs through timely investment.

This marked the first time that Samsung Electronics suggested the possibility of expanding its capacity in legacy node. Samsung Electronics has been expanding investment in the system semiconductor sector for years. The company is expected to ramp up investment to expand legacy nodes this year. In 2021, Samsung Electronics’ facility investment reached an all-time high of 48.22 trillion won and increased 25.3 percent from a year ago.

Samsung Electronics will also continue to introduce derivative process technologies that enhance performance and cost competitiveness by improving old processes. In October 2021, the company announced that it will increase production efficiency by applying a new fin field-effect transistor (FinFET)-based 17-nm process to the production of image sensors and mobile display driving ICs (DDIs) that have been produced on existing 28-nm processes of a flat structure.

Thus far, Samsung Electronics has focused on developing advanced process technologies instead of legacy processes. However, as the legacy process market has grown to an unprecedented level due to a semiconductor boom, analysts say that Samsung Electronics is actively responding to demand expansion by scaling up related investments. 

In TSMC's case, the share of legacy nodes, which refer to 16-nm or above chipmaking processes, accounted for 50 percent of its revenue in 2021. Samsung accounts for about 40 percent of the global market in the advanced 10-nm or lower process sector. But its share is much smaller in the matured process segment.

Samsung Electronics plans to secure up to 300 foundry customers by 2026 and triple production from the 2017 level.

Despite a difficulty in securing a desired yield, Samsung Electronics expressed its intention to carry out volume production on its 3-nm or below processes without a hitch. Samsung has built the world's first 3-nm process using gate all around (GAA) technology, which is expected to roll out chips in the first half of 2022. Its 2-nm process based on third-generation GAA technology will start volume production in 2025

The company narrowed its technology gap with TSMC via volume production of 4-nm products in April 2021. “We plan to expand business opportunities by securing overseas trade lines and strengthening responsiveness to high-growth markets such as the high-performance computing (HPC) and automotive markets.”

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