Samsung Electronics Co Ltd (ADR) (LSE:BC94) is attracting growing interest from prospective customers seeking advanced semiconductor manufacturing capacity as demand for leading-edge chips continues to outstrip available supply at rival foundry operator Taiwan Semiconductor Manufacturing Company.
According to a report by Nikkei Asia, companies including BYD, Advanced Micro Devices and Google are exploring the possibility of using Samsung’s foundry business for future chip production.
The discussions are said to include advanced driver assistance system processors for BYD, certain AMD central processing units planned for release from 2028 onwards, and Google’s Axion processors as well as input and output dies used in its tensor processing units.
Nikkei also reported that a number of smaller Chinese semiconductor customers are approaching Samsung to manufacture advanced chips, reflecting increasing demand for access to cutting-edge production technologies.
The reported interest appears to be driven primarily by capacity constraints at TSMC rather than a fundamental shift in customer perceptions of Samsung’s manufacturing capabilities.
TSMC remains widely regarded as the industry leader in contract chip manufacturing, with the company maintaining an advantage in process technology, yields and customer relationships.
However, the rapid expansion of artificial intelligence infrastructure, high-performance computing and advanced automotive electronics has fuelled expectations of sustained demand growth for advanced semiconductor manufacturing over the remainder of the decade.
Against that backdrop, Samsung’s available capacity could become increasingly valuable to customers seeking supply security and production flexibility.
Additional foundry orders would support factory utilisation rates and potentially strengthen a business that has struggled to narrow the gap with TSMC in recent years.
The development may also be viewed positively for the broader semiconductor sector, as it suggests customers are planning for robust demand well beyond the next two years.
For TSMC, meanwhile, inquiries directed towards alternative suppliers may ultimately underscore the strength of demand for its manufacturing services, with customers reportedly seeking additional capacity because production availability is expected to remain constrained through at least 2028.
