Samsung claims Intel outsourcing will grow foundry industry, mum on probable tie-up

By Joyce Lee and Heekyong Yang

© Reuters/Kim Hong-Ji
FILE Image: The emblem of Samsung Electronic is observed at its headquarters in Seoul

SEOUL (Reuters) – Samsung Electronics on Thursday commented for the very first time on Intel’s final decision to outsource much more of its chipmaking, but declined to chat about any feasible partnership with just one its essential rivals.

Intel, one of the number of remaining firms that both equally styles and would make its very own chips, explained past week it would lean far more seriously on outside factories, or foundry suppliers, and could even licence technological know-how from exterior firms.

Samsung, the top maker of memory chips, and TSMC, the world’s major agreement chip producer, are regarded as Intel’s only rivals for substantial-conclusion chips.

“We do assume that Intel’s choice to outsource – from the whole foundry market point of view – will lead to escalating total foundry industry measurement,” Shawn Han, senior vice president of Samsung’s foundry small business, instructed a write-up-earnings connect with.

Even so, he declined to comment on any doable partnership or quantify the influence of these a go by Intel, which arrives as some traders think the firm has misplaced its manufacturing guide to Asian corporations.

Intel presently partners with TSMC to make chips utilised in self-driving cars and trucks, and resources told Reuters earlier this thirty day period that it strategies to faucet the Taiwanese business to make some graphics chips for individual computers.

Intel could also outsource legacy solutions like graphics chips, fairly than its flagship processors, said Greg Roh, head of exploration centre at Hyundai Motor Securities.

“Simply because legacy items do not have to have a large amount of superior technology, it appears to be that Intel will make a decision outsourcing amount of money right after looking at how factors stand with both equally Samsung and TSMC. Intel is not in a situation to be dependent on a distinct company,” he explained.

TSMC stood a far better prospect than Samsung of teaming up with with Intel as it was just a contract maker, said Lee Seung-woo, an analyst at Eugene Financial investment & Securities.

Samsung on Thursday forecast solid demand from customers for its chips in the March quarter, as operate-from-house gadgets this kind of as laptops and tablets keep on to fly off cabinets.

(Reporting by Joyce Lee and Heekyong Yang in Seoul Added reporting by Jihoon Lee Writing by Sayantani Ghosh modifying by Richard Pullin)