What Samsung Foundry might do after reaching the 2nm node this year is shocking
Samsung Foundry has been having yield issues for several years and this year's low yield at 3nm resulted in a delay in the production of the 3nm Exynos 2500 application processor (AP). Thanks to the delay, Samsung had to address a probable shortage issue by using the Qualcomm Snapdragon 8 Elite AP on all models of its flagship Galaxy S25 line. Originally the plan was to use the Qualcomm SoC on all Galaxy S25 Ultra phones and Galaxy S25 and Galaxy S25+ units in the U.S., Canada, and China. All other models would sport the Exynos 2500.
Next year's Exynos 2600 is rumored to be built using the 2nm node that Samsung Foundry is mass producing later this year. But test yields at this node are also poor (30%) even though there has been talk of an overall improvement in the foundry's yields. A distant second in market share to TSMC, Samsung Foundry currently has 8.2% of the contract foundry industry compared to 67.1% for TSMC according to Korea Economic Daily.
TSMC has a huge number of tech superstars as clients including Apple, Nvidia, Qualcomm, MediaTek, Broadcom, and Intel. You might be surprised to see Intel on the list since the chipmaker has started its own contract foundry business. Despite this, Intel still needs to outsource some of its production to TSMC.
So what is next for the industry after 2nm? All the big non-sanctioned names like TSMC, Samsung Foundry, and Intel have been exploring production at a 1.4nm node. But now comes word via industry leaker @Jukanlosreve that Samsung Foundry is considering dropping its plans to manufacture chips at a 1.4nm node. That could be a serious problem for Samsung Foundry. To understand what it all means, let's look at this using a simple explanation.
Typically, the more transistors that fit inside a chip, the more powerful and energy-efficient a chip is. Reducing the process node means that smaller transistors are used and that increases the transistor count and the transistor density. The latter tracks the number of transistors found in a certain area of a chip. For example, the A13 Bionic chip that powered the iPhone 11 Pro Max was made using TSMC's 7nm+ process node and carried 8.5 billion transistors.
Samsung Foundry is still facing issues with its production yields on advanced nodes. | Image credit-Samsung Foundry
Fast forward to today's more powerful and efficient A18 Pro chip used to power the iPhone 16 Pro and iPhone 16 Pro Max. It is made by TSMC using its second-gen 3nm node and while Apple hasn't released the transistor count, it is believed to be over 20 billion.
Samsung Foundry must improve its yields. Otherwise there is a good chance that the foundry will no longer produce chips at advanced nodes and stick to producing chips for certain industries that require the use of older process nodes. As a result, Samsung might have to continue to use Qualcomm chips on all of its flagship and foldable phones which could impact the pricing of those phones since it is cheaper for the manufacturer to source its own silicon for its devices than to buy components from Qualcomm.
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