Samsung to produce chips for iPhones again, starting next year

- Adrian Ungureanu

It seems that Samsung might regain its contract with Apple to produce chips for the iPhones, a contract that the Korean tech giant has lost in 2013 in favor to Twiwan’s TSMC.

According to news reports on July 18, Samsung recently purchased extreme ultra violet lithography machines, the most advanced chip manufacturing equipment, to produce seven-nanometer mobile processors solely for iPhone.

Sources say Kwon Oh-hyun, one of Samsung’s three co-CEOs who oversees chip and other parts businesses, played a key role in clinching the deal during his visit to Apple’s headquarters last month.

Samsung was a major chip producer for Apple until 2013 when TSMC became the sole maker for iPhone chips. TSMC succeeded in winning a supply deal for next year’s iPhone by adopting the more energy efficient seven-nanometer technology earlier than rivals.

The reports say Samsung would share some parts of the iPhone orders next year that have been monopolized by TSMC.

Samsung plans to complete its own tests for the new chip-making machines soon and seek final approval from Apple for the chip production.

TSMC, the world’s No. 1 foundry firm, took up a 50.6 percent market share in the global chip foundry sector with its revenue reaching US$28.8 million in 2016, followed by Global Foundry of the US with 9.6 percent, and Taiwan’s UMC with 8.1 percent, according to market research firm IHS. Samsung held a market share of 8.1 percent during the same year.