[News] Samsung Foundry’s Q2 Loss Estimated Above KRW 2T; Advanced Node Clients Remain Critical

According to South Korean outlet DealSite, Samsung Electronics’ weaker-than-expected second-quarter results have renewed focus on its foundry business. The report notes that while the company has recently secured some legacy process orders, securing major contracts from global tech giants for advanced nodes remains crucial for a return to profitability.

As indicated in the report, sources estimate that Samsung’s foundry division recorded a significant loss in the second quarter. Although the company does not separately disclose foundry performance, analysts cited in the report estimate a combined operating loss of approximately KRW 2.5 trillion, including the System LSI division.

The report notes that despite recent wins in legacy processes, such as the NVIDIA Tegra T239 chip used in Nintendo’s Switch 2 and produced on Samsung’s 8nm process, the impact on reducing losses has been limited.

Samsung Focuses on 2nm over 1nm as It Works to Improve Yields

As the report notes, Samsung’s 3nm process will be deployed in the upcoming Galaxy Z Flip, which is expected to exclusively feature the in-house Exynos 2500 chip. However, with yields reportedly at just 30 to 40 percent, the company is likely to incur losses.

Regarding its 2nm process, the report states that yields are reportedly below 30 percent and adds that Samsung has yet to secure orders from global tech giants for this node.

As mentioned by Chosun Biz, sources indicate that Samsung is aiming to raise 2nm yield rates to around 70 percent by the end of this year. The outlet highlights that the core challenge is to stabilize yields and secure U.S. clients before its Taylor, Texas fab begins full-scale production, given the scale of the investment.

Citing sources, Chosun Biz also reports that Samsung has adopted a “select and focus” strategy, prioritizing 2nm over the riskier 1nm-class nodes, based on expectations that major U.S. AI chipmakers will continue to rely on 2nm processes over the next two to three years.

Samsung Reportedly Evaluating High-NA EUV

DealSite further states that Samsung is working to enhance its 2nm process by delaying its 1.4nm roadmap from 2027 to 2029, while accelerating efforts to adopt High-NA EUV technology. Industry sources cited in the report note that Samsung is currently test-operating High-NA equipment in its foundry to evaluate its capabilities.

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(Photo credit: Samsung)