Samsung focused on increasing efficiency rates in the 2nm GAA production process to achieve profitability targets in its semiconductor foundry unit. Han Jin-man, head of the company’s DS (Device Solutions) department, stated that the increase in usage in mature nodes such as 4nm and 8nm gives positive signals, and announced that they aim for sustainable profitability until 2028. However, the company emphasizes that its portable-oriented business structure and performance-based bonus system create significant obstacles on the way to this goal. Trying to position itself as an alternative to TSMC on a global scale, Samsung continues to struggle with operational structural difficulties despite technological developments.

Productivity Increase Supports Profitability Goals

Strengthening its technological infrastructure, Samsung is trying to strengthen its hand in market competition, especially by increasing the efficiency rates in the 2nm GAA process. Although strong revenues from the company’s memory unit support the overall financial picture, it is stated that stricter strategies need to be implemented in order for the foundry unit to stand on its own feet. Han Jin-man emphasizes that operational costs in particular need to be optimized.

The current structure of the performance-based bonus system negatively affects the budget discipline in the company’s foundry unit.

Managerial Strategies Enter the Process of Change

To compete with TSMC, Samsung’s foundry unit focuses not only on technology but also on its business structure. Past strikes and employee claims limit the company’s flexibility in cost management. The administration plans to develop strategies that appeal to a wider range of customers by going beyond the portable-focused hierarchy.

The competitive prices offered by Qualcomm directly affect Samsung’s efforts to gain market share for Exynos processors. While the company aims to write a comeback story with the Exynos 2700 model, it is critical for production efficiency to reach 70%. Otherwise, Samsung will still remain a secondary option for global giant customers.

Industry experts state that in order for Samsung to become a real player in the foundry market, it must exceed the 70% efficiency threshold in 2nm processes.

Sectoral Competition Increases Its Intensity

Increasing chip demand with the artificial intelligence boom presents a great opportunity for Samsung. However, turning this opportunity into profitability depends on making the right managerial decisions. The company has to maintain the delicate balance between employee motivation and cost discipline. The strategies to be implemented in the coming years will determine Samsung’s global position in the semiconductor market.

What strategy do you think Samsung should follow against TSMC’s market dominance and will the efficiency increase in 2nm technology be sufficient? Share your opinions with us in the comments section below.