Samsung Says Intel Outsourcing Will Expand Foundry Market, Pending Possible Link



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SEOUL (Reuters) – Samsung Electronics commented on Thursday for the first time on Intel’s decision to further outsource its chipmaking, but declined to talk about a possible partnership with one of its main rivals.

Intel, one of the few remaining companies to design and manufacture its own chips, said last week that it would rely more on outside factories or foundry manufacturers, and may even obtain technology licenses from them. outside companies.

Samsung, the leading memory chip maker, and TSMC, the world’s largest contract chip maker, are seen as Intel’s only high-end chip competitors.

“We believe that Intel’s decision to outsource – from the perspective of the foundry market as a whole – will lead to an increase in the overall size of the foundry market,” said Shawn Han, senior vice president of Samsung’s foundry operations, in a post-benefit call.

However, he declined to comment on a possible partnership or to quantify the impact of such a move by Intel, which comes as some investors believe the company has lost its manufacturing lead to Asian companies.

Intel is already partnering with TSMC to make chips for use in self-driving cars, and sources told Reuters earlier this month that it plans to hire the Taiwanese company to make graphics chips for personal computers.

Intel could also outsource legacy products such as graphics chips, rather than its flagship processors, said Greg Roh, head of the research center at Hyundai Motor Securities.

“Since legacy products don’t require a lot of advanced technology, it looks like Intel will decide the amount of outsourcing after seeing how things go with Samsung and TSMC. Intel is not in a position to depend on any particular company, ”he said.

TSMC had a better chance than Samsung of partnering with Intel because it was only a contract manufacturer, said Lee Seung-woo, analyst at Eugene Investment & Securities.

Samsung forecast strong demand for its chips in the March quarter on Thursday, as work-at-home devices like laptops and tablets continue to fly off the shelves.

Reporting by Joyce Lee and Heekyong Yang in Seoul; Additional reporting by Jihoon Lee; Written by Sayantani Ghosh; edited by Richard Pullin

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