Samsung Elec to triple advanced chip manufacture by 2027, sees robust demand

Samsung-Elec-to-triple-advanced-chip-production-by-2027,-sees-robust-demand

SEOUL (Reuters) - Samsung Electronics' chip contract manufacturing business said on Tuesday it plans to further than triple its advanced chips production capacity by 2027 to meet strong demand despite current global financial headwinds.

The world's second-largest foundry after Taiwan Semiconductor Industrial Co (TSMC) is targeting mass making of advanced 2-nanometre knowledge chips by 2025 and 1.4-nanometre chips by 2027, set for use in applications such as high-performance computing and artificial intellect.

"There has been approximately progress (in raising prices) this year, and costs are being replicated... New guidelines won currently will be finished after 2-3 years, so the direct impact of the current atmosphere will be minimal," said Moonsoo Kang, executive vice president of Samsung Electronics' foundry commercial.

Samsung began mass creating chips with 3-nanometre expertise in June. The company was in talks with potential clients for 3-nanometre collaboration, including Qualcomm, Tesla and Advanced Micro Devices, Samsung said.

Samsung, the world's major memory chip manufacturer, has had problems in meeting clients' expectations for foundry yields in recent years. Analysts said the corporation had pushed advanced knowledge too quickly to compete with TSMC, but had hurt from having less involvement with the long-term client cooperation needed in contract industrial.

Samsung co-CEO Kyung Kye-hyun told journalists its foundry commercial had lagged TSMC's development schedule and presentation in 5- and 4-nanometre chips, but clients were involved in the second version of 3-nanometre chips to be made from 2024.

"We have been caring in line with customers' expectations since the start of 3-nanometre mass manufacture this year," Kang said.

He noted that demand for progressive 5-nanometre and finer chips is rapidly increasing despite current inflationary pressures due to long-term expansion of high-performance computing, artificial intelligence, 5G and 6G connectivity and automotive applications.

The industry may find it difficult to meet demand even if all planned investments are executed, he said.

The limited number of innovative chipmaking machineries that can be produced by Dutch corporation ASML limits how much innovative chip capacity can be added, Kang added.

"U.S. clients are especially involved in production in the United States, for supply chain solidity," Kang said. "Our Taylor site is very large... It's a good site for expansion," he added.

Samsung is currently structure chip production in Taylor, Texas for processes starting in 2024.

(Broadcasting by Joyce Lee; editing by Richard Pullin)