Samsung Foundry has been navigating a challenging landscape, particularly with its 3nm GAA process. The low yield rates have significantly impacted the production of the Exynos 2500 chip, forcing Samsung to rely on Qualcomm's Snapdragon 8 Elite for its flagship Galaxy S25 series. This situation underscores broader issues within Samsung's semiconductor division, including financial strains and competitive disadvantages against industry leaders like TSMC.3nm GAA Process Yield IssuesReports indicate that Samsung's 3nm GAA process yields are reportedly below 20%, making large-scale production of the Exynos 2500 challenging. This has resulted in an insufficient supply of Exynos 2500 chips for Samsung's mobile division, leading to a reliance on Qualcomm chips for their flagship devices.Potential Cancellation of 1.4nm NodeRumors are circulating that Samsung may cancel or postpone the development of its 1.4nm process node, originally slated for 2027. This decision could stem from financial difficulties or a strategic pivot to focus on improving yields for existing nodes, such as the 2nm process. Such a move would represent a significant shift in Samsung's long-term roadmap.Competitive LandscapeSamsung Foundry's market share has declined to 8.2%, while TSMC dominates with a 67.1% share in Q4 2024. This stark contrast highlights the competitive gap between the two companies. Furthermore, Samsung's 2nm process yields are reportedly at 30%, significantly lower than TSMC's 60% for similar processes, further exacerbating the challenge.Future StrategiesSamsung is prioritizing the development of its 2nm process, aiming to improve yields and regain competitiveness. The company is focusing on the Exynos 2600 chip, which will be its first commercial 2nm chip, in an effort to attract major clients and demonstrate its technological prowess.Implications for the FutureThere may be cuts in facility investments due to low demand for advanced nodes and reduced orders for legacy nodes. The potential cancellation of the 1.4nm node could further disadvantage Samsung in high-performance computing and AI markets, where cutting-edge process technology is crucial.Samsung Foundry's struggles with its 3nm GAA process and the potential cancellation of the 1.4nm node highlight significant challenges in maintaining competitiveness against TSMC. The company's focus on improving yields and developing the 2nm process is crucial for its future in the semiconductor industry. However, the current situation raises concerns about the long-term viability of Samsung's foundry business and its ability to compete at the highest levels of chip manufacturing.
