[News] Samsung Tapped to Produce Apple’s New Chips at Austin Fab, Likely iPhone Image Sensors

According to Business Korea, Samsung Electronics is set to manufacture Apple’s next-generation chips at its U.S. facility.

In a press release from August 6, Apple announced its partnership with Samsung to co-develop a new chip manufacturing technology, which will debut globally at Samsung’s fab in Austin, Texas. As noted in the press release, Apple stated that by introducing this technology in the U.S. first, the Austin plant will produce chips that enhance power efficiency and performance across Apple products—including the iPhone—distributed worldwide.

Apple’s statement was part of a broader announcement to invest an additional USD 100 billion in the U.S., bringing its total commitment to USD 600 billion over the next four years, as noted by Reuters.

Citing industry sources, Business Korea notes that the chip Samsung is expected to produce will likely serve as an image sensor in future iPhones and other Apple devices.

As Business Korea further explains, Samsung Electronics’ image sensor brand, ISOCELL, is developed by the company’s System LSI Business Division and will be manufactured at the Austin facility. Built using a two-wafer bonding process, ISOCELL sensors are currently supplied to Samsung’s own Galaxy smartphones, as well as to other manufacturers including Xiaomi, Vivo, and Motorola, the report adds.

Apple’s decision to work with Samsung Electronics aligns with its strategy to source components in the U.S. and diversify its supply chain, according to Business Korea. Until now, Apple has relied exclusively on Sony in Japan for iPhone image sensors. As per Business Korea, Sony commanded more than 50% of the global image sensor market last year, while Samsung ranked second with a 15.4% share.

In addition to its partnership with Apple, Samsung recently announced a 22.8 trillion won (approximately USD 16.5 billion) chip foundry agreement with Tesla to manufacture next-generation Full Self-Driving (FSD) AI6 chips at its Texas facility, as noted by Reuters. With major clients like Tesla—and now Apple—onboard, Business Korea indicates that Samsung Electronics is expected to reduce operating losses in its semiconductor division.

Meanwhile, Samsung Electronics is also likely to reveal the amount of its new investment in the U.S., as Korean companies are expected to announce the scale of their U.S. investments at the upcoming Korea–U.S. summit, Business Korea notes.

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(Photo credit: Samsung)