At one point in time, Samsung was making chipsets for Qualcomm. This was a huge deal because nearly all Android smartphones out there are powered by Qualcomm’s chips. But then Qualcomm ultimately jumped ship to TSMC, who ultimately became the industry standard. But now, the latest reports claim that Samsung is finally turning a profit on its chips division after three years.
Samsung chips division is now making profit
According to a report from Korean publication Bloter, it looks like Samsung is finally making profit on its chips. The company is said to have made its first profitable month after three years, and surprisingly, it was largely driven by its 4nm process. Not its 3nm process, and not the more advanced and current 2nm process.
However, it makes sense. Yes, 2nm is the latest in semiconductor technology. But it’s also expensive and not always necessary. For example, a smart display or smart speaker might need a chipset. But does it need a 2nm chip, or can it get away with a 4nm or 7nm chip? Obviously the latter. Plus, lower costs means that Samsung can make up for it in volume.
It also appears that the improvement in manufacturing yields and increased production of HBM base dies were contributing factors too.
In the past, Samsung has struggled with its yields. It was one of the reported reasons Qualcomm ultimately decided to ditch Samsung for TSMC. However, if Samsung’s yields have improved, it could draw more customers back to them. Of course, it remains to be seen if Samsung can continue posting a profit, or if this is just a one-time thing.
Samsung’s customer base
It also helps that Samsung has some big names as customers. The company’s HBM chips are being used by customers such as AMD and NVIDIA for AI applications. More recently, there was a rumor that Anthropic is also seeking its own custom hardware, and they might turn to Samsung.
Also, back in May, there were rumors that Apple is potentially looking to Samsung for some of its future chips. Apple has largely been exclusive with TSMC for the longest time now. However, TSMC’s shift towards AI hardware means Apple needs to start diversifying its supply chain, lest they get caught in a situation where TSMC is unable to manufacture chips based on Apple’s timeline.
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