Samsung’s chip manufacturing operations are predominantly based in South Korea, where the company produces chips using its most advanced processes. While the company also has a chipmaking subsidiary in Arizona, USA, and is investing nearly $20 billion to develop a new advanced facility in Taylor, Texas, the financial returns have not been as expected.
Despite having a state-of-the-art 3nm process in South Korea, Samsung Foundry has been struggling with a lack of lucrative orders, resulting in substantial financial losses. The Arizona subsidiary has also faced challenges, reportedly losing 1.7248 trillion won (approximately $1.21 billion) over the past four years.
Samsung’s primary competitor, TSMC, is also experiencing losses in the US. Both companies face significant financial hurdles in the US due to the high costs of chipmaking. However, these investments are seen as essential for mitigating risks posed by geopolitical instability.
The situation remains difficult for Samsung as it prepares to open its Taylor, Texas plant. Construction of the facility is reportedly complete, but the company has not yet installed the necessary chipmaking equipment. This delay has been attributed to Samsung’s hesitation to place orders, given the current challenging business environment.
Additionally, Samsung faces concerns over potential tariffs on imported chipmaking equipment, which could be subject to rates of up to 25% or more, further raising costs.
Although earlier reports indicated that Samsung might delay production at the Taylor plant until 2027, the company has reaffirmed its intention to have the facility operational by 2026, as originally planned.
For more insights into Samsung’s challenges and the latest in technology, visit our Technology category.
Disclaimer: This report reflects publicly available information and industry estimates at the time of publication. Financial figures, timelines, and corporate strategies may change without notice. Readers should confirm details with official company statements before making investment or business decisions.
