A Samsung flag flies exterior the corporate workplace in Seoul, South Korea on February 05, 2024.
Chung Sung-jun | Getty Pictures Information | Getty Pictures
Samsung Electronics has entered right into a $16.5 billion contract for supplying semiconductors to a significant firm, a regulatory submitting by the South Korean firm confirmed Monday.
The reminiscence chipmaker, which didn’t identify the counterparty, talked about in its submitting that the efficient begin date of the contract was July 26, 2024 — receipt of orders — and its finish date was Dec. 31, 2033.
Samsung declined to touch upon particulars concerning the counterparty.
The corporate mentioned that particulars of the deal, together with the identify of the counterparty, won’t be disclosed till the top of 2033, citing a request from the second get together “to guard commerce secrets and techniques,” in keeping with a Google translation of the submitting in Korean.
“For the reason that major contents of the contract have been not been disclosed because of the want to keep up enterprise confidentiality, traders are suggested to speculate fastidiously contemplating the opportunity of modifications or termination of the contract,” the corporate mentioned. Its shares had been up almost 3% in early buying and selling.
Native South Korean media shops have mentioned that American chip agency Qualcomm may probably place an order for Samsung’s 2 nanometer chips.
Whereas Qualcomm is a risk, given its current 2 nanometer venture with Samsung, Tesla appears the extra possible buyer, Ray Wang, analysis director of semiconductors, provide chain and rising know-how at The Futurum Group, advised CNBC
Samsung’s foundry service manufactures chips based mostly on designs supplied by different corporations. It’s the second largest supplier of foundry providers globally, behind Taiwan Semiconductor Manufacturing Firm.
The corporate mentioned in April that it was aiming for its foundry enterprise to start out mass manufacturing of its subsequent technology 2 nanometer and safe main orders for the superior product. In semiconductor know-how, smaller nanometer sizes signify extra compact transistor designs, which result in larger processing energy and effectivity.
Samsung, which is ready to ship earnings on Thursday, expects its second-quarter revenue to greater than halve. An analyst beforehand advised CNBC that the disappointing forecast was resulting from weak orders for its foundry enterprise and because the firm has struggled to seize AI demand for its reminiscence enterprise.
The corporate has fallen behind rivals SK Hynix and Micron in high-bandwidth reminiscence chips — a sophisticated sort of reminiscence utilized in AI chipsets.
SK Hynix, the chief in HBM, has change into the primary provider of those chips to American AI behemoth Nvidia. Whereas Samsung has reportedly been working to get the most recent model of its HBM chips licensed by Nvidia, a report from a native outlet suggests these plans have been pushed again to at the very least September.
