As competition between contract chipmakers heats up, foundries tend to increase their capital expenditures to satisfy the demands of their clients for the latest production nodes. TSMC last week said it would dramatically increase CapEx spending this year as it preps to ramp up manufacturing of 2nm-class chips next year. Intel is expected to follow, though its CapEx increase will likely be moderate. But unlike its industry peers Samsung intends to slash spending on its foundry unit, reports TrendForce citing SEDaily.
Samsung has been spending billions of dollars every year on its foundry and memory production capacities for about 10 years now. However, the Samsung Foundry unit is cutting its CapEx by more than half in 2024, allocating ₩5 trillion ($3.5 billion) compared to ₩10 trillion ($7 billion) last year, according to the report. The decision allegedly reflects reduced client demand and efforts to improve efficiency. Samsung has reportedly faced difficulties in attracting large customers due to delays in advanced manufacturing processes and lower-than-expected yield rates. Utilization rates for its 4–7nm-class production lines at Pyeongtaek have reportedly fallen by over 30%, though SEDaily does not specify the period over which the utilization rate dropped by a third.
