It probably doesn’t surprise anybody that Samsung has now created a new division for contract chip manufacturing. The Korean giant has been making its own chips under the Exynos brand, but lately they’ve been in partnerships with manufacturers like Qualcomm and NVIDIA, making a lot of these 3rd party chips on Samsung’s own foundries. This was a logical move for them.
Now Samsung is officially seeking to attract more business to make OEM chips, not just Qualcomm and NVIDIA. This new division will be branching out from Samsung’s existing chip divisions, but will still be overseen by Kim Ki-nam, Samsung’s president for its chip businesses.
Revenue from Samsung’s foundries is certainly not one of its bigger profits, but the business seems to be steadily growing, and looking at its partnership with Qualcomm for the production of the Snapdragon 835 – it seems that the business is capable of taking care of itself and ready for growth. Research firm IHS estimates Samsung’s foundry revenue rose 86 percent to USD$4.7 billion in 2016.
What will be interesting is how competitors would react to this, like TSMC in Taiwan and Intel, and clients like Qualcomm. We’re waiting to see if there will be any moves to at least counter or match this new business from Samsung.