When the Samsung Galaxy S23 lineup of phones rolled around the company made the decision to switch all of its Ultra models over to Snapdragon. A privilege previously exclusive to certain markets only, this decision came about as a result of poor performance from Samsung Foundry’s Exynos chips. Now we’re about to see global layoffs of up to 30 percent of Samsung’s international workforce as the company also withdraws personnel from its manufacturing plant in Texas.
Though it hadn’t even become fully operational yet, Samsung’s plant in Taylor, Texas is now being operated by a skeleton crew. The plant was supposed to help cement the company’s chip manufacturing dreams. Falling behind and losing customers to TSMC (Taiwan Semiconductor Manufacturing Company) has spurred the company into overdrive, but to no avail as of yet.
The main reason for Samsung’s lack of success in the chip manufacturing business is its poor yield. According to reports, the 2 nm chips Samsung has been working on have a yield as low as 10 percent at times. This seriously puts in jeopardy Samsung’s plans to manufacture 1.4 nm chips by 2027.
A “semiconductor professor” claims that the company’s archaic ways of conducting business are to blame for this failure.
The pervasive bureaucracy within Samsung, slow decision-making, and low compensation are the main reasons for the decline in foundry competitiveness.
At the same time there are reports of Samsung considering laying off up to 30 percent of its global workforce. That’s not just a reflection of the company’s current state, it’s also a severe blow to countless people’s livelihoods.
Exynos has consistently underperformed over the years. | Image credit — PhoneArena
Samsung is trying desperately for Exynos to make a comeback. In-house chip development has the potential to completely revolutionize a company’s products. Just look at Apple silicon, for example, and the company is even planning to start producing in-house cellular modems for iPhone, iPad and more.
As we continue to see even slimmer Samsung phones the need for smaller chips intensifies. And if Samsung Foundry can’t supply that need or retain other customers, the company continues to spend more and conduct further layoffs.
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Abdullah is an ardent believer in the future of VR, and can't wait to see what more it brings to the table as technology improves. He enjoys covering new software releases in the XR industry, as well as major news about hardware and companies focused on VR.
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