Samsung and Broadcom forge $200 billion AI chip partnership to challenge TSMC dominance

Samsung Elec wins $200 billion Broadcom AI chip partnership, boosting foundry push

SEOUL, July 25 (Reuters) - Samsung Electronics (005930.KS), opens new tab said on Saturday it struck a pact with U.S. chip designer Broadcom (AVGO.O), opens new tab to widen cooperation across memory chips, contract chip making and advanced packaging envisaged to exceed $200 billion until 2030. Winning long-term production commitments from Broadcom, one of the world's leading custom AI chip designers, could boost utilisation at Samsung's advanced manufacturing facilities to pull ahead in the race to supply AI chips. "The expanded collaboration ... reflects Samsung's focus on supporting customers with end-to-end semiconductor technologies across an increasingly diverse range ⁠of AI and high-performance computing applications," the company said in a statement. The tie-up comes as global technology companies increasingly develop their own custom AI accelerators, rather than relying solely on general-purpose graphics processors, driving demand for specialised chip design and manufacturing partnerships. The two firms' memorandum of understanding underscores Samsung's efforts to beef up its position in AI semiconductors by expanding its long-term ties with Broadcom amid growing demand up for custom AI processors. The next five years of collaboration will combine ⁠Broadcom's expertise in designing application-specific integrated circuits (ASICs), or chips for specific tasks, with Samsung's manufacturing capabilities. The deal provides for Broadcom's next-generation communications chips, designed for high-speed data transfer, to be made with Samsung's sub-2-nanometre process technology, Samsung said. The two will also collaborate on next-generation high-bandwidth ⁠memory (HBM) products. The partnership could help strengthen Samsung's foundry business, as it seeks to narrow the gap with industry leader TSMC (2330.TW), opens new tab by wooing major technology customers. Last month, co-CEO and chip division ⁠head Jun Young-hyun said he discussed next-generation foundry cooperation with Jensen Huang, chief executive of Nvidia (NVDA.O), opens new tab, including future HBM4E and HBM5 memory products. Samsung said this year it ⁠expected to secure more advanced 2-nanometre foundry orders in the near term after discussions with major tech companies. Last year, it won a $16.5-billion contract to make logic chips for EV maker Tesla (TSLA.O), opens new tab. Reporting by Heekyong Yang; Editing by Clarence Fernandez Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Disrupted * ADAS, AV & Safety * Sustainable & EV Supply Chain

Samsung and Broadcom sign $200 billion chip deal spanning memory, foundry and packaging

Samsung Electronics and Broadcom have signed a memorandum of understanding worth more than $200 billion spanning memory chips, foundry manufacturing and advanced packaging for artificial intelligence semiconductors. The deal, announced on Friday at an AI summit in San Francisco, runs for five years through 2030 and covers some of the most critical layers of the AI chip supply chain. It is one of the largest semiconductor partnerships ever disclosed, though as an MOU it represents a statement of intent rather than a binding contract. On the memory side, Samsung will supply Broadcom with next-generation high-bandwidth memory, including HBM4 and HBM4E chips, for use in Broadcom's AI accelerators. In foundry, Samsung will manufacture Broadcom products using two-nanometer and smaller process technologies at its campus in Pyeongtaek, South Korea. The collaboration also extends to advanced packaging that integrates memory and logic more tightly, a technique increasingly central to squeezing more performance out of AI silicon. Broadcom designs custom AI chips for hyperscalers including Google, Meta and others that want silicon tailored to their specific workloads rather than buying off-the-shelf GPUs from Nvidia. The company extended its AI chip partnership with Meta through 2029 in April, and CEO Hock Tan recently said surging AI revenue has made organic growth more attractive than acquisitions. By diversifying manufacturing to Samsung, Broadcom gains supply chain resilience beyond its existing reliance on TSMC, which controls more than 90 percent of leading-edge chip production. For Samsung, the deal addresses a persistent credibility gap in its foundry business, where its global market share has fallen to roughly seven percent while TSMC dominates. The company has struggled with yields on its two-nanometer process, but a $200 billion customer commitment from one of the industry's largest chip designers could change the calculus for investors who have questioned whether Samsung can compete at the leading edge. Samsung posted record quarterly operating profit of 89 trillion won in Q2, driven almost entirely by AI memory demand. The signing took place alongside a broader package of semiconductor deals worth roughly $950 billion between South Korean and American companies, announced during an AI summit hosted by South Korean President Lee Jae Myung. SK Hynix signed memory partnerships worth $750 billion with Nvidia and others, and Anthropic signed supply agreements with both Samsung and SK Hynix. The summit followed Seoul's $880 billion domestic investment plan unveiled in June, which committed Samsung and SK Hynix to building four new chip fabrication plants in the country's southwest.

Samsung Electronics and Broadcom Expand Strategic Collaboration Across Memory and Foundry Technologies

Companies sign memorandum of understanding to broaden collaboration on next-generation AI infrastructure, spanning leading-edge memory, foundry technologies and advanced packaging Samsung Electronics and Broadcom today announced the signing of a memorandum of understanding (MOU) to expand their strategic collaboration across memory and foundry technologies, supporting the next generation of AI infrastructure. The MOU was announced during the AI Summit, held at The Midway in San Francisco. Attendees included Jinman Han, President and Head of Samsung Electronics' Foundry Business, Hock Tan, President and CEO of Broadcom, senior executives from both companies and representatives of the Korean government. The companies expect the collaboration to be estimated at more than $200 billion across memory and foundry over the next five years through 2030. On the memory front, Samsung and Broadcom plan to pursue a strategic collaboration for the supply of industry-leading memory solutions, including High Bandwidth Memory (HBM), supporting Broadcom's next-generation AI accelerators. In foundry, the companies' collaboration focuses on Samsung's 2-nanometer (nm) and below process technologies for Broadcom's products, including Wireless Broadband Communications (WBC) solutions. The collaboration is expected to extend to advanced packaging technologies built on Samsung's 2nm process, including 2.3D and 2.5D integration, to enable higher-performance and more power-efficient AI and networking silicon. "AI is driving unprecedented demand for tightly integrated semiconductor technologies spanning memory, logic and advanced packaging," said Young Hyun Jun, Vice Chairman & CEO of the Device Solutions (DS) Division at Samsung Electronics. "By expanding our collaboration with Broadcom across these critical technologies, we look forward to delivering greater value to customers while advancing the AI infrastructure of the future." "As AI infrastructure continues to scale, close collaboration across the semiconductor ecosystem becomes increasingly important," said Charlie Kawwas, President, Semiconductor Solutions Group of Broadcom. "By combining Samsung's memory and foundry expertise with Broadcom's AI and connectivity leadership, we aim to continue to deliver technologies that power the next generation of AI infrastructure." With capabilities encompassing memory, logic, foundry and advanced packaging, Samsung is uniquely positioned to deliver integrated semiconductor solutions for the AI era. The expanded collaboration with Broadcom reflects Samsung's continued focus on supporting customers with end-to-end semiconductor technologies across an increasingly diverse range of AI and high-performance computing applications.

Samsung Electronics wins $200 billion Broadcom AI chip partnership, boosting foundry push

The tie-up comes as global technology companies increasingly develop their own custom AI accelerators, rather than relying solely on ⁠general-purpose graphics processors, driving demand for specialised chip design and manufacturing partnerships. The next five years of collaboration will combine Broadcom's expertise in designing application-specific integrated circuits (ASICs), or chips for specific tasks, with Samsung's manufacturing capabilities. Samsung Electronics said on Saturday it struck a pact with U.S. chip designer Broadcom to widen cooperation across memory chips, contract chip making and advanced packaging envisaged to exceed $200 billion until 2030. Winning long-term production commitments from Broadcom, one of the world's leading custom AI chip designers, could boost utilisation at Samsung's ⁠advanced ⁠manufacturing facilities to pull ahead in the race to supply AI chips. "The expanded collaboration ... reflects Samsung's focus on supporting customers with end-to-end semiconductor technologies across an increasingly diverse range of AI and high-performance computing applications," the company said in a statement. The tie-up comes as global technology companies increasingly develop their own custom AI accelerators, rather than relying solely on ⁠general-purpose graphics processors, driving demand for specialised chip design and manufacturing partnerships. The two firms' memorandum of understanding underscores Samsung's efforts to beef ⁠up its position in AI semiconductors by expanding its long-term ties with Broadcom amid growing demand up for custom AI processors. The next five years of collaboration will combine Broadcom's expertise in designing application-specific integrated circuits (ASICs), or chips for specific tasks, with Samsung's manufacturing capabilities. The deal provides for Broadcom's next-generation communications chips, designed for high-speed data transfer, to be made with Samsung's sub-2-nanometre process technology, Samsung said. The two will also collaborate on next-generation high-bandwidth memory (HBM) products. The partnership could help strengthen Samsung's foundry business, as it seeks to narrow the gap with industry ⁠leader TSMC by wooing major technology customers. Last month, co-CEO and chip division head Jun Young-hyun said he discussed next-generation foundry cooperation with Jensen Huang, chief executive of Nvidia, including future HBM4E and HBM5 memory products. Samsung said this year it expected to secure more advanced 2-nanometre foundry orders in the near term after discussions with major tech companies. Last year, it won a $16.5-billion contract to make logic chips for EV maker Tesla.