Building a high-end smartphone chip is a challenging task, and right now, Samsung is caught in a pretty strange paradox. On the bright side, the development of its next big flagship processor, the Exynos 2700, is going without a single hitch. However, at the same time, the corporate division in charge of creating these chips is quietly bleeding money.
According to domestic outlet Chosun Biz, Park Yong-in, the head of Samsung’s System LSI branch, recently called an internal meeting to give employees a reality check on how things are going. He shared that even though the team actually celebrated record-breaking sales numbers during the first quarter of the year, a wider annual deficit is pretty much unavoidable because of shrinking global demand and rapid market shifts.
The gap between sensors and silicon
The good news is that the issue doesn’t lie across Samsung’s entire hardware portfolio. In fact, highly successful sections like image sensors and power management chips are bringing in great profit. Instead, the standalone System-on-Chip (SoC) team—the group tasked with building the actual brains for smartphones—is single-handedly absorbing the losses that are dragging down the division’s total numbers.
Despite these clear financial headaches, engineering work on the upcoming Exynos 2700 hasn’t slowed down. Leadership confirmed that development is moving along right on track. The ultimate goal is to put the chip inside the premium Galaxy S27 flagship lineup next year. Early estimates suggest this custom silicon will power up to 50% of all global Galaxy S27 shipments. This represents a massive jump from the 25% footprint we saw in older generations (via Wccftech).
An expensive manufacturing hurdle
So, why is the mobile processor team losing cash if the future chips are scheduled to launch on time? It mostly boils down to low manufacturing yields on Samsung’s incredibly complex 2nm Gate-All-Around (GAA) production lines. Current industry estimates guess the production yield rate is sitting at roughly 60%. In other words, a big chunk of every processed silicon wafer ends up as useless waste instead of functioning chips.
As each wafer produces fewer usable processors, the cost to build the Exynos 2700 jumps significantly. Those efficiency rates make it tough for outside clients to place independent manufacturing orders. President Park acknowledged these structural frustrations. He promised teams that management is reviewing all possible options to build a workspace where creators can focus purely on technology rather than corporate constraints.
If the finished Exynos 2700 can successfully prove its worth against rival heavyweights like Qualcomm’s Snapdragon chips next year, it might just restore global customer confidence and completely turn the tide for Samsung’s custom silicon future.
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