After starting commercial production of 3 nanometer semiconductors this year, Samsung announced it will begin creating chips with a 2 nanometer process in 2025 and 1.4 nanometer technology in 2027.
As Samsung tries to catch up to industry leader TSMC, they would be some of the most sophisticated chips in the world.
In comparison to current year, Samsung expects to more than triple its production capacity for the most sophisticated semiconductors by 2027, including plans in Texas.
As the contest between the South Korean electronics giant and the world’s top chip maker TSMC heats up, Samsung announced Tuesday that it expects to produce some of the most sophisticated semiconductors in the world in five years.
The business outlined its chip manufacturing goals, stating that it will begin producing chips with a 2 nanometer process in 2025 and a 1.4 nanometer process in 2027.
The nanometer measurement is used to describe the size of each individual transistor on a device. The smaller the transistor, the more can fit on a single semiconductor. Typically, shrinking the nanoscale size results in more powerful and efficient devices.
In instance, Apple’s latest iPhone 14 Pro and Pro Max versions have a 4 nanometer technology.
Earlier this year, Samsung began manufacturing 3 nanometer semiconductors.
In South Korea, Samsung shares finished nearly 4% higher on Tuesday.
The South Korean company, famed for consumer electronics and memory chips, is trying to expand its contract chipmaking, or foundry, business in order to compete with Taiwan’s TSMC.
According to TrendForce, Samsung is the world’s second-largest foundry by revenue, with a 17.3% market share compared to TSMC’s 52.9%.
TSMC, for its part, intends to start producing 3nm chips this year, with 2nm chips following in 2025. However, no plans to mass manufacture 1.4nm semiconductors have been formally confirmed by the corporation.
“This is the first time that SEC (Samsung Electronics) has provided guidance for its long-term foundry plan, and I believe it is more aggressive than TSMC and market expectations,” said SK Kim, analyst at Daiwa Capital Markets, to CNBC.
Samsung’s ambitious aspirations come despite global economic challenges and evidence of a semiconductor market downturn. According to the Semiconductor Industry Association, global semiconductor industry revenues declined 3.4% in August compared to July.
Despite this, Samsung stated that it aims to more than triple its production capacity for the most sophisticated chips by 2027 compared to this year, demonstrating its optimism about future demand.
These include its plants in the United States. Samsung operates a factory in Austin, Texas, and is also constructing a $17 billion complex near Taylor, Texas.
Washington has been attempting to entice chipmakers such as Samsung and TSMC to establish plants in the United States in order to minimise dependency on Taiwan and South Korea as manufacturing hubs.
While Samsung has prioritised cutting-edge chips, the firm also stated that semiconductors for high-performance computing, automotive, and 5G applications will account for more than half of its foundry business by 2027. These are often less sophisticated chips.