Samsung's been struggling to catch up with TSMC in the lucrative contract chip manufacturing market. The Korean giant has been investing heavily in new foundry facilities to increase its capacity and technology, but there's a new deal on the horizon that might spell trouble for Samsung.
TSMC holds the dominating market share while Samsung is in a distant second. There are reports of a major deal between TSMC and Intel. Multiple options are on the table, including an outright acquisition of Intel's foundry business.
TSMC could gain a major foothold in the US through Intel
The Trump administration has reportedly proposed that TSMC should acquire Intel's foundry business. Intel entered the foundry business in 2021 but that hasn't helped the company's fortunes as it lost $19.2 billion in 2024.
Talks between the two companies are said to be in early stages with other options being considered as well, such as a joint venture or a technology sharing agreement with Intel. Many analysts believe that while an outright acquisition may not happen due to antitrust concerns, it's possible that TSMC may buy Intel's chip factories in the US.
Whatever deal materializes, it's going to be a headache for Samsung. The company recently shook up the top level management of its semiconductor division to better address the many challenges this part of the business faces.
Han Jin-man, the newly appointed head of Samsung's foundry, urged employees to rapidly ramp up production on the 2nm process to gain a technological advantage.
Like Samsung, TSMC has been setting up new foundry facilities in the US.
If it ends up acquiring Intel's factories, TSMC would be able to rapidly boost its production capacity and also command a combined market share of more than 75%. It would become even more difficult for Samsung to compete against that scale.
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