Let Samsung Electronics announced on Monday (July 28) that it has secured a US$16.5 billion agreement to manufacture chips for a major unnamed global client, a move that boosted its shares by 3.5%.
The South Korean tech giant revealed that the contract, finalized on Saturday, involves foundry services, though specific details—including the identity of the client and terms—will remain confidential until the contract concludes in 2033.
This development arrives as Samsung continues to face challenges in the competitive landscape of AI chip production, which has negatively impacted its earnings and stock performance.
Samsung’s foundry division already includes high-profile customers like Tesla and Qualcomm, while its main competitor, TSMC, counts Apple and Nvidia among its clients.
The deal also comes amid South Korea’s efforts to strengthen its trade relations with the United States, especially in the semiconductor and shipbuilding sectors, as it tries to avert potential US tariffs of up to 25%.
It remains unclear whether this new order will influence Samsung’s long-delayed production plans at its upcoming Texas facility, which has faced setbacks due to difficulties in attracting major clients.
According to Lee Min-hee of BNK Investment & Securities, Samsung is still working to improve the production yield of its 2-nanometer chip technology, and this new contract likely doesn’t involve those cutting-edge chips.
Samsung’s ongoing loss of market share to TSMC in the foundry business reflects the technological hurdles it must overcome to draw premium clients such as Apple and Nvidia away from its more advanced rival, analysts noted.me know if you’d like a more formal, detailed, or casual variation!
