Samsung aims to surpass TSMC in 7nm foundry by next year

After separating its foundry division into a separate business that's level with memory and phones, Samsung foresees its nanometer processes to jump ahead of leader TSMC.

Samsung Electronics forecasts a big jump in revenue next year for its foundry or chip contract making business, while surpassing leader TSMC in processing technology, a senior executive has said.

"By next year, we plan to become a runner-up way ahead of rivals in terms of revenue," said Sanghyun Lee, vice president of marketing for Samsung Foundry.

"I think our EUV process for 7nm can be called full EUV. When we introduce our process next year, we will have an advantage over them [TSMC] in yield rate and price," Lee said.

The company is currently offering the 10-nanometer process, which is being used for its Exynos and Qualcomm's latest offerings this year. In the first half of next year, it is planning an 8-nanometer process.

In the second half of 2018, it is planning to deploy the 7-nanometer process, using extreme ultra violet (EUV) lithography for the first time. It will be followed by 6-nanometer and 5-nanometer in 2019. Lee said the varied sizes was to offer clients more choice.

Main rival TSMC is expected to offer 7-nanometer process earlier and reportedly clinched Qualcomm's next-generation chips that will use the process for next year.

Samsung and TSMC are the fierce rivals for global customers such as Apple, Qualcomm, and MediaTek.

In May, Samsung promoted the contract making division into a business, making it level with mobile, TV, and memory businesses in terms of status. Previously, it was grouped under the System LSI, or logic, business that designs Exynos, but which are now separated.

"Mobile accounts for big portion of the foundry business right now. But new logic semiconductors for automotive, IoT, network, datacentres and new businesses will continue to grow. We will see more demand from these businesses in the future," Lee said.

Samsung also plans to offer solutions that combine logic chips with memory, such as embedded MRAM, going forward.

The South Korean tech giant and Intel are the only remaining integrated device makers or semiconductor firms globally that can both design and fabricate chips. Samsung also offers its packaging service and is a leader in memory chips.

Lee said the firm will leverage this to offer value-added package solutions that meet client needs.

The firm opened a foundry forum in May in the US to brief clients, and another in South Korea on Tuesday. It also recently opened a website to offer process design kits and intellectual property access for clients.

Meanwhile, Samsung's memory chip business is enjoying an all-time high and is expected to contribute the lion's share of the record 14 trillion won expected for the second quarter.

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