In response to low global demand, Samsung Foundry production capacity will be reduced by 50%
Samsung announced that it will reduce the semiconductor production capacity of its Samsung Foundry division by 50%. reported the decision this week, in response to low global demand for semiconductors. The South Korean technology company is partially closing its foundry facilities to minimize operating costs.
The reduction will affect the 4nm, 5nm and 7nm lines (nanômetro) on Pyeongtaek Lines 2 (P2) and 3 (P3). So far, more than 30% of the capacity of these lines has been deactivated. Additionally, Samsung plans to expand the shutdown to about 50% of its facilities by the end of the year. The strategy includes a gradual interruption of operations, allowing adjustments according to customer demand.
Samsung faces challenges in securing large-scale orders from technology companies such as Nvidia, AMD and Qualcomm. Therefore, the decision to partially shut down production lines seeks a more efficient reduction in costs, especially in relation to electricity consumption.
Additionally, weaker than expected orders from fabless Chinese companies also impacted Samsung. These companies used to contribute to the 4nm and 5nm process volumes. Trade restrictions imposed by the US on China’s semiconductor industry have worsened the situation.
