According to two sources with knowledge of the matter, Samsung Electronics Co., Ltd. has raised prices for new orders of certain advanced chip foundry services by up to 15%. The price adjustment comes as surging AI chip demand has pushed Taiwan Semiconductor Manufacturing's advanced capacity to near saturation, prompting some clients to shift orders to Samsung, a long-time follower in the foundry space that now finds itself with newfound pricing power.
This price hike marks a significant turning point for Samsung's foundry business. Industry estimates indicate the unit has been operating at a loss since 2022. Despite record profits driven by soaring memory chip prices, Samsung's foundry division has continued to struggle in narrowing the gap with Taiwan Semiconductor Manufacturing.
The sources said Samsung raised prices for chips manufactured using its 4-nanometer process, known as SF4, in July. One source revealed that SF4 prices for customers in China and the U.S. increased by 10% to 15% compared to the previous month, while wafers produced with the 5-nanometer process (SF5) saw price increases of 10% to 15%. Prices for older 8-nanometer technology products also rose by nearly 10%. Samsung declined to comment on the matter, as the company does not disclose details of its operational activities.
Data from research firm Counterpoint shows that in the first quarter of 2026, Samsung accounted for 7% of global foundry revenue, while Taiwan Semiconductor Manufacturing held over 70% of the market share. However, demand for AI chips has consumed the vast majority of Taiwan Semiconductor Manufacturing's advanced process capacity. Samsung expects advanced processes to account for more than half of its foundry revenue this year, with AI and high-performance computing applications representing over 30%, up from 15% to 20% at the end of 2025.
As Taiwan Semiconductor Manufacturing's capacity tightens, Samsung has gained greater leverage in pricing negotiations. Lee Min-hee, an analyst at BNK Investment Securities in Seoul, noted, "As TSMC faces capacity constraints and raises prices, customers are turning to competitors like Samsung and Intel, which has prompted Samsung to raise prices in tandem." He also pointed out that if Samsung begins increasing prices from this point onward, its foundry business could achieve profitability as early as next year, sooner than previously anticipated.
Samsung's SF4 production line is operating at full capacity, and Google is reportedly in talks for collaboration. A person familiar with Samsung's operations said the SF4 production line at its Pyeongtaek plant in South Korea has been running at full capacity since late last year. The line produces logic chips for clients such as Qualcomm and also manufactures base chips used in Samsung's own multi-layer high-bandwidth memory (HBM) products.
In July, Samsung stated that thanks to improved factory utilization, higher production yields, and stronger pricing, it expects its foundry division to return to profitability in the near future. The company also noted at the time that growing sales from major U.S. and Chinese customers, coupled with demand for HBM base chips, should help drive double-digit percentage year-over-year growth in foundry revenue in the second half of the year.
Improved production yields have also helped Samsung win clients. Tesla and Apple reached chip manufacturing agreements with Samsung last year. In July, Samsung announced an AI chip production deal with Broadcom, and NVIDIA CEO Jensen Huang said in March that Samsung would manufacture its new AI inference processors. Sources with knowledge of the matter also revealed that Google is in discussions with Samsung to produce chips using the SF4 process. Google did not respond to requests for comment.