New Contract Chip Manufacturing Division Samsung Semiconductors

Samsung Electronics Co Ltd. Has recently formed a new division within its semiconductor business exclusively for contract chip manufacturing, as the firm aims to attract more customers.

The new division will be responsible for making mobile processors and other non-memory chips for clients such as Qualcomm Inc and Nvidia Corp, competing with firms such as Taiwan Semiconductor Manufacturing Co.

It will continue to be overseen by Kim Ki-nam, Samsung’s president overseeing all chip businesses.

The move is unlikely to surprise. Analysts had speculated that the firm would eventually split apart its foundry and system chip operations to make them more efficient and ease concerns from customers about potential leaks to parts of Samsung that compete with them.

Although revenue from the foundry business remains a small portion of Samsung’s overall sales, it has seen sharp growth. Research firm IHS estimates Samsung’s foundry revenue rose 86 percent to $4.7 billion in 2016.


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