In the competitive semiconductor industry, Samsung Electronics has set its sights on expanding its foundry services alongside its internal LSI (Large Scale Integration) operationsThis strategic pivot is rooted in the company’s historical strengths in memory chips, such as DRAM and NAND flash, but also acknowledges the fierce challenges presented by cyclical market demands and the dominance of foundry giant TSMC (Taiwan Semiconductor Manufacturing Company).

With a recognized goal to ascend from being the world's leading memory chip manufacturer to a formidable contender in the foundry business, Samsung announced an ambitious investment plan in 2019. This initiative entails an estimated $120 billion investment over the next twelve years, significantly bolstering their system LSI capabilities and foundry prowessThe company aspires not only to maintain its memory market leadership but also to eclipse TSMC in foundry services, outpace Sony in the CMOS image sensor arena, and ultimately become the top semiconductor manufacturer globally by revenue.

Despite these ambitious plans, reports from South Korean media indicate that the gap between Samsung and TSMC is widening, with potential operating losses nearing a billion dollars expected for the first half of this yearNonetheless, Samsung continues to pursue aggressive strategies and innovative solutions to bridge this gap, determined to reshape its future amidst the industry's rapid evolution.

One key area of focus is advanced packaging, an essential component of modem chip design that enables increased chip performance without relentless downscaling of individual nodesSamsung has faced criticism for lagging behind its main competitor, TSMC, in this domain, as TSMC has successfully captured numerous new orders through their superior advanced packaging strategies.

However, recent developments within Samsung's foundry operations reveal efforts to address these challenges

Advertisements

In June of the previous year, the company established a dedicated semiconductor packaging task force, comprising engineers from its foundry division and semiconductor research centerThis group aims to propose advanced packaging solutions and foster closer partnerships with clients.

At the 2022 Samsung Foundry Forum, Moonsoo Kang, head of the foundry business development, articulated the team's ambition to forge paths in advanced packaging technologies that transcend Moore’s law, emphasizing collaborations that optimize both “More Moore” and “More Than Moore” approachesBy leveraging advanced heterogeneous integration techniques, Samsung is actively looking to advance its offerings in this critical sector.

In line with this vision, the company has developed several advanced packaging technologies including I-Cube, H-Cube, and X-Cube, each targeting specific performance enhancements in chip designThe I-Cube solution employs a 2.5D packaging method where chips are arranged side by side on an intermediary layer, while H-Cube innovatively addresses the industry's PCB shortagesMeanwhile, the X-Cube introduces a fully 3D packaging approach that stacks chips vertically, utilizing advanced bonding techniques.

To drive this segment forward, Samsung has attracted industry talent, notably poaching Lin Jun Cheng, a semiconductor packaging expert with nearly two decades of experience at TSMCDuring his tenure, Lin contributed significantly to TSMC's advanced packaging technology and established a product line that has secured substantial contracts from leading tech companies.

Furthermore, prior to hiring Lin, Samsung lured semiconductor specialist Kim Woo-Pyung from Apple, solidifying its commitment to enhancing its US packaging solutions division

Advertisements

Though recruiting top talent does not guarantee success, it is a notable step towards building a robust advanced packaging capability.

In tandem with packaging advancements, Samsung's long-term ambitions include developing proprietary mobile chipsRevamping its own mobile processor design is crucial not only for the sustainability of its smartphone business but also for the future potential in expanding into PC and automotive chips, as well as other high-performance markets.

The developments over the past few years illustrate Samsung’s gradual and strategic advancements in this sectorNotably, in 2019, the company announced that it would cease its in-house CPU core development, closing down its Austin semiconductor facility dedicated to this purpose and laying off several employees as part of a difficult but necessary restructuring.

Fast forward to May 2022, reports emerged indicating the formation of a dedicated task force dubbed the "Dream Platform One Team." This group’s mission focuses on designing a customized Samsung mobile processor that could rival Apple’s M1 chips.

In recent updates, a team led by a former AMD senior engineer has been accelerating the development of the next-generation “Galaxy Chips,” projected to transition Samsung’s laptops and smartphones from an ARM architecture to proprietary CPU cores by 2027.

Coinciding with this, the initial launch of Galaxy Chips is anticipated for 2025, marking a departure from the Exynos branding towards a more defined identityAlthough the inaugural products may initially utilize ARM-based cores, there are indications that the company envisions introducing its own architecture CPU by 2027, although conflicting reports suggest Samsung refuted these claims.

As a significant part of its chip development strategy, Samsung has also strengthened its GPU endeavors through a partnership with AMD.

In January 2022, Samsung unveiled the new Exynos 2200 mobile processor featuring an advanced GPU based on AMD's RDNA 2 architecture

Advertisements

This innovative GPU, named Xclipse, uniquely bridges the gap between console and mobile graphics, incorporating features like hardware-accelerated ray tracing that have traditionally been reserved for high-end computing.

Despite initial setbacks in market performance, Samsung has reiterated its commitment to collaborate with AMD, confirming the use of RDNA GPUs in future Exynos series processorsThe Samsung vice president overseeing GPU development has assured that the company will maintain its partnership with AMD to leverage RDNA technology for enhanced performance in upcoming products.

Outside the mobile chip sector, Samsung is also making strides in automotive chip advancements.

Reports from February reveal that Samsung Electronics hired Benny Katibian, a former Qualcomm vice president, as a senior vice president at their Austin, Texas locationKatibian is set to lead the company's advanced computing labs and core development center.

This recruitment aligns with Samsung’s strategic initiative to diversify its automotive system-on-chip (SoC) operations, with the company’s system LSI division working on the AI-based Exynos Auto processorStrengthening the Exynos Auto platform remnants a key objective for maintaining industry leadership.

Additionally, partnerships within the automotive chip sector continue to evolve, with Samsung reportedly collaborating with Hyundai to design and manufacture logic chips for future advanced driver-assistance systems and infotainment setups.

In closing, Samsung Electronics has recently laid plans for ambitious semiconductor infrastructure investments, targeting approximately $229 billion over the next two decades

Advertisements

Advertisements