Samsung Secures Over $200 Billion Contract to Supply 2-Nanometer Chips to Broadcom
Key Takeaways
- •Samsung Electronics won a contract worth more than $200 billion to manufacture chips for Broadcom over a five-year period running through 2030.
- •The agreement focuses on Samsung's 2-nanometer and sub-2nm process technologies, along with advanced packaging techniques designed for higher-performance AI silicon.
- •Samsung will also supply memory components for Broadcom's next-generation AI accelerators as part of the expanded partnership.
- •The deal marks a notable competitive advance for Samsung's foundry business, which has historically trailed TSMC in securing orders at cutting-edge process nodes.
- •The announcement was timed with South Korean President Lee Jae Myung's Silicon Valley visit, during which several other AI-related technology partnerships involving Korean companies were disclosed.
Samsung Electronics Co. has secured a contract valued at more than $200 billion to manufacture chips for Broadcom Inc., marking a significant step in both companies' efforts to capture a larger share of the rapidly growing AI infrastructure market.
According to a statement released by the South Korean chipmaker on Saturday, the five-year agreement will run through 2030 and will center on Samsung's 2-nanometer and sub-2nm process technologies for Broadcom's product lineup. The deal broadens the strategic partnership between the two companies, which already spans memory and foundry technology.
On the memory side, Samsung will supply components for Broadcom's next-generation AI accelerators. The collaboration is also expected to encompass advanced packaging technologies built on Samsung's 2nm process node, including 2.3D and 2.5D integration techniques designed to deliver higher-performance, more power-efficient AI and networking silicon.
The contract represents a major foundry win for Samsung, which ranks as the world's second-largest contract chipmaker but has trailed Taiwan Semiconductor Manufacturing Co. in securing orders at the most advanced process nodes. The 2nm generation is widely seen as a critical threshold for AI chips, where gains in transistor density and power efficiency directly translate into lower operating costs for data center operators running large language models and other compute-intensive workloads.
Samsung and its domestic rival SK Hynix Inc. are both accelerating their global campaigns to win AI chip orders, facing intensifying competition from industry leaders such as Taiwan Semiconductor Manufacturing Co. South Korea has set an ambitious national goal of doubling its memory production capacity within five years and establishing world-class manufacturing capabilities to outpace competing nations.
Read More: Samsung, SK to Spend $880 Billion to Drive Korea's AI Lead
The Samsung-Broadcom announcement coincides with South Korean President Lee Jae Myung's visit to Silicon Valley, where he is attending an AI summit. Several technology deals have been unveiled during the trip, including partnerships between Nvidia Corp. and South Korea's Naver Corp. and SK Hynix Inc. (Bloomberg)
Source: Fortune