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Samsung Foundry disbands development division, possibly giving up on 2 nm production [UPDATED]

By Abdullah Asim

Updated: Dec 05, 2024, 5:14 AM

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Update from December 5, 2024:

A spokesperson for Samsung Foundry has reached out and clarified a few points. Samsung Foundry's development division's disbanding is part of routine business operations and not indicative of the company abandoning progress altogether. Work on 2 nm and 1.4 nm production is still underway and the mentioned yield rates for 3 nm wafers are said to be baseless rumors.

The original story from December 4, 2025 follows below:

Samsung Foundry hasn’t had the best year but now it seems that the company is finally prioritizing its actions. According to reports Samsung has disbanded the foundry technology development division and reassigned personnel to other teams.

Reassigned personnel have reportedly been relocated to divisions focusing on yield management, mass production and process design (via Jukanlosreve on X). This is apparently being interpreted as Samsung trying to improve its 3 nm fabrication yields before moving on to smaller chipsets. If this is true then Samsung’s plans for 1.4 nm chips by 2027 are well and truly dead for now.

And I believe that’s a very good thing. Samsung Foundry has been struggling, hard. Yield rates have been as low as a miserable 10 percent and half of the foundry lines are being shut down. Even Samsung employees say that the company is in crisis as it plans to lay off 30 percent of its workforce before the year ends.

So if Samsung is willing to put its lofty ambitions on hold for a moment to focus on improving current production then that’s a win in my book. The company needs to get better at manufacturing Exynos chips because the alternative just got a whole lot worse.

Samsung Galaxy S24 Ultra uses a Snapdragon processor. | Image credit — PhoneArena

Qualcomm is allegedly planning to significantly hike the price of the upcoming Snapdragon 8 Elite Gen 2. This has sent Samsung into a panic because its flagships already cost more than its biggest rival’s: Apple.

There have been talks at the company about outsourcing chip production to TSMC. MediaTek has also been approaching Samsung with lucrative discounts. If Samsung doesn’t take MediaTek up on its offer then the next Galaxy phones may have to cheap out on displays and cameras. Samsung will also probably try to negotiate better terms with domestic component manufacturers.

Modern chip measurements are marketing and not based in fact. The jump from a “3 nm” chipset to a “2 nm” one will be a marginal improvement at best. Improving 3 nm yields, in my opinion, will serve Samsung far better financially than chasing after the next nanometer breakthrough.

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Abdullah loves smartphones, Virtual Reality, and audio gear. Though he covers a wide range of news his favorite is always when he gets to talk about the newest VR venture or when Apple sets the industry ablaze with another phenomenal release.

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