Samsung's ambitious 1.4nm plans in jeopardy as foundry challenges mount

Samsung faces challenges with its 1.4nm manufacturing plans and foundry market competition.

: Samsung's ambitions for its SF1.4 1.4nm node, which aimed to boost efficiency and performance, are now uncertain. The rumor of its potential cancellation emerged amid troubles with earlier nodes and competition favoring TSMC and Intel, which leads in market share. Samsung has scaled back investments, reducing foundry spending by more than 50% to KRW 5 trillion in 2025. The company also struggles with declining market shares and external geopolitical and material volatility.

Samsung's plan to advance into 1.4nm-class manufacturing, known as the SF1.4 node, is under threat. The SF1.4 node was set to provide significant improvements in power efficiency and performance, crucial for high-performance computing and artificial intelligence applications. Samsung intended this innovation to lower production costs, allowing the company to increase its market share. However, rumors from leaker @Jukanlosreve suggest that Samsung might abandon the SF1.4 node entirely, casting doubt on its ambitious roadmap.

The company originally intended to introduce the SF1.4 by 2027 in high-volume manufacturing, along with other nodes like SF2A designed for automotive, and SF2Z, which would have introduced backside power delivery technology. Unfortunately, Samsung Foundry has experienced issues with subpar yields from the SF3 process, leading to the delay of the Exynos 2500 launch. Samsung also faced demand reductions in its earlier 5nm and 7nm nodes.

Despite these obstacles, Samsung continues its efforts in developing the Exynos 2600 using its SF2 process and is engaging in AI chip production for PFN. Orders for 4nm nodes from Chinese companies affected by sanctions might provide some relief. Nevertheless, Samsung Foundry's performance in the market remains overshadowed by competitors; it holds an 8.2 percent share compared to TSMC's commanding 67.1 percent. The Exynos department might be shifted to Samsung MX, potentially improving control over future smartphone chip designs.

Broader industry challenges further compound Samsung's difficulties. The company's overall market share has fallen across several divisions: smartphone market share declined from 30.1 percent in 2023 to 28.3 percent in 2024, and DRAM market share fell from 42.2 percent to 41.5 percent. Additionally, geopolitical instability and fluctuations in raw material prices add to Samsung's operational challenges.

In response to these pressures, Samsung is reducing its 2025 foundry investments by more than half, lowering them to KRW 5 trillion ($3.5 billion), in contrast to KRW 10 trillion in 2024. Samsung's financial adjustments reflect its strategic realignments amidst the complex challenges and heightened competition within the semiconductor market.

Sources: TechSpot, Korea Economic Daily, Business Post, Chosun

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