Samsung plans to churn out more chips despite a global economic slowdown
Samsung plans to churn out more chips despite a global economic slowdown
Samsung began production at its P3 chip plant, which is its largest anywhere on the earth, a few months back. Dutch firm ASML supplied the EUV machines for the factory, with the company initially producing cutting-edge NAND flash memory chips. It now plans to expand the factory by adding a 12-inch wafers capacity for DRAM memory chips, MoneyControl reports citing unnamed industry sources from the South Korean newspaper Seoul Economic Daily. The Korean behemoth also plans to manufacture its 4nm or smaller foundry chips here, though it may not have many big customers left. The likes of Qualcomm and Tesla have switched to its foundry rival TSMC recently. The Taiwanese firm is already way ahead of Samsung in this sector. Recent market reports say the two companies captured 56.1 percent and 15.5 percent of the global foundry market, respectively. Samsung is struggling to close the gap. However, the company’s plan of increasing production when rivals are scaling back may help it in the long run. At least in the memory chips segment. TSMC has already announced a ten percent cut in its annual semiconductor investment this year. Memory chip maker Micron Technology also recently announced that it will only invest around $7.5 billion in fiscal 2023, down from $12 billion this year. This investment cut may continue in 2024 depending on the market situation. Samsung, on the other hand, said it doesn’t intend to reduce chip production, let alone cut investment. “We plan to stand behind our original infrastructure investment plans,” the company’s executive vice president of memory business Han Jin-man said in October. Perhaps it is now gearing up to increase production. Analysts see this strategy paying off and helping Samsung gain a stronger grip on the memory market. The plan may eventually add to its share price when semiconductor demand recovers. “The chip industry downturn will add to the difficulties of No. 2 and below chip companies, and have a positive impact on the market control of top companies such as Samsung,” said Greg Roh, head of research at Hyundai Motor Securities.
