Samsung Electronics Pyeongtaek Semiconductor Plant./Provided by Samsung Electronics
As Samsung Electronics' foundry (semiconductor consignment manufacturing) division lifted the 'shutdown' that turned off the power to its production facilities, it has been reported that it plans to raise the operating rate of the Pyeongtaek Campus (P) foundry production line to its maximum starting this June. The operating rate is expected to recover as the volume of Exynos, a smartphone application processor (AP) of Samsung Electronics' System LSI division, and orders for Chinese cryptocurrency miners increase.
According to industry sources on the 13th, Samsung Electronics Foundry Division has decided to lift the shutdown of its Pyeongtaek Campus foundry production line and increase its operating rate to its maximum starting this June. With orders for the 4㎚ (nanometer, 1 billionth of a meter) process increasing significantly, the company plans to operate its production facilities at 'full capacity.'
The foundry division suffered from a deficit of trillions of won last year due to sluggish orders, and made an all-out effort to reduce costs by shutting down production facilities. Last year, Samsung Electronics shut down about 50% of its 4㎚, 5㎚, and 7㎚ foundry production facilities at its P2 and P3 factories in Pyeongtaek Campus.
However, it has been reported that Samsung Electronics' foundry division lifted the shutdown this month to increase the operating rate of some production lines. As a result, most of the facilities that were suspended during the shutdown have returned to a state of operation. The adjustment of the operating rate was influenced by factors such as the Exynos volume of Samsung Electronics' System LSI division, the increase in orders for cryptocurrency miners due to the economic stimulus from China, and the production volume of 'logic die', which is the brain of the 6th generation high-bandwidth memory (HBM4).
An official familiar with Samsung Electronics’ circumstances said, “We have turned all of the equipment that had been shut down back on and started producing products,” adding, “We are planning to operate at full capacity starting in June, when all of our production facilities will be put into production.”
However, there are also concerns that US regulations on China could hinder the recovery of operating rates. Currently, Samsung Electronics' foundry division is experiencing difficulties in securing orders from big tech companies for advanced processes below 3㎚, and relies on Chinese companies for a significant portion of its sales. Baidu of China is a major customer for Samsung Electronics' foundry division's 4㎚ process. Samsung Electronics, which is closely monitoring US sanctions against China, is known to have recently temporarily suspended production of Baidu products. Baidu is known to have preemptively purchased Samsung Electronics' HBM in preparation for the strengthening of US export regulations last year.
A semiconductor industry insider said, “Samsung Electronics recently temporarily halted production of Baidu products that had been manufactured on its 4㎚ production line,” and “Although it has not officially stopped shipping to Chinese companies, it is presumed that it is assessing the impact since President Trump took office.”
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