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Samsung Considers Spinning Off Chip Making Business in Wake of Loss of Apple’s Business

Samsung Considers Spinning Off Chip Making Business in Wake of Loss of Apple’s Business

Samsung is reported to be considering spinning off its chipmaking business, in the wake of losing Apple’s A-series chipmaking business to competitor TSMC. The company is considering either separating the design and manufacturing divisions, spinning them off as fabless and foundry division.

Samsung Considers Spinning Off Chip Making Business in Wake of Loss of Apple's Business

Business Korea:

The consideration came after the company lost Apple, the largest customer in the sector of application processors (AP), which refers to the brain of smartphones, to Taiwan’s TSMC and some raised awareness towards the need to separate the foundry business division.

Previously, orders for the A-series chips that power Apple’s lineup of iOS mobile devices were split between Samsung and TSMC. However, Apple awarded the complete production of the current A10 chip to TSMC, and is reportedly ready to do the same for next year’s A11 chip. Samsung has expected to grab at least a third of the A11 production.

Samsung’s plan is to grow their System LSI business more systematically by dividing its system semiconductor design and manufacturing capabilities. They may also focus more on Android-related business, having recently won a large contract with Qualcomm, the maker of the Snapdragon processors used in Android devices.

Meanwhile, TSMC looks to use a 10 nanometer process for next year’s A11 chip, which is a huge improvement on the 16nm chip used in the current iPhone 7. The Taiwanese company announced last week that it plans to build a $15.7 billion facility in Taiwan for the fabrication of 5-nm and 3nm chips

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