Samsung Electronics has raised prices on new orders for certain advanced foundry services by up to 15%, according to a Wednesday report. This move marks a significant turning point for the Korean tech giant's long-struggling chip contract manufacturing business, driven primarily by the explosive growth in demand for AI chips.
Two sources familiar with the matter revealed that Samsung raised its foundry prices for the 4-nanometer (SF4) process in July, with increases ranging from 10% to 15% for customers in mainland China and the United States. Wafer prices for the older 5-nanometer SF5 process also rose by 10% to 15%, while prices for the legacy 8-nanometer process increased by nearly 10%.
Lee Min-hee, an analyst at BNK Investment & Securities in Seoul, stated that as TSMC's capacity tightens and prices rise, customers are shifting to competitors like Samsung and Intel, which gives Samsung greater pricing power. She further noted that if Samsung continues to raise prices, its foundry business could become profitable as early as next year, ahead of previous market expectations.
Turning Point for Foundry: Pricing Power Returns After a Downturn
This price increase marks a clear reversal for Samsung's foundry business after a prolonged period of pressure. According to research firm Counterpoint, Samsung held only a 7% share of global foundry revenue in the first quarter of 2026, while TSMC accounted for over 70%. Since 2022, Samsung's foundry division has sustained losses and has consistently failed to narrow the gap with its dominant rival.
However, the rapid expansion of AI demand is reshaping the supply-demand dynamics of the foundry market. TSMC's advanced process capacity has been largely booked out, giving Samsung more room to negotiate prices. The SF4 production line at Samsung's Pyeongtaek plant in South Korea has been running at full capacity since late last year, producing logic chips for clients such as Qualcomm and also manufacturing base dies for Samsung's own high-bandwidth memory (HBM) chips.
Samsung said in July that it expects its foundry division to return to profitability in the near future, citing improved factory utilization, better yields, and stronger prices. The company also projected that foundry revenue in the second half of the year would grow by double-digit percentages year-over-year, driven by increased sales from major customers in the US and China as well as demand for HBM base dies.
Expanding Customer Base Strengthens Samsung's Foundry Ecosystem
Meanwhile, Samsung's foundry customer roster is rapidly growing, further solidifying its ability to raise prices. Tesla and Apple both signed chip manufacturing agreements with Samsung last year. In July, Samsung announced a partnership with Broadcom for AI chip production. Nvidia CEO Jensen Huang also stated in March that Samsung would provide foundry services for its new AI inference processors. Reports also indicate that Google is currently in talks with Samsung to use the SF4 process for chip production.
Samsung expects advanced processes to account for more than half of this year's foundry revenue, with AI and high-performance computing applications exceeding 30% of the total, up from 15% to 20% at the end of 2025. With an optimized customer structure and sustained high capacity utilization, the profitability outlook for Samsung's foundry business is becoming increasingly clear.
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