Samsung Electronics has implemented price increases of up to 15% on selected advanced foundry services for new orders, according to people familiar with the matter. The move follows a surge in demand for AI-capable chips that has tightened capacity across the contract manufacturing market, a segment long dominated by Taiwan Semiconductor Manufacturing Co.
Sources said demand originating in China has been particularly robust, but Samsung must balance those orders against commitments to U.S. customers and capacity reserved for its own internal chip production. Those constraints have limited Samsung's ability to fulfil every incoming request, the sources added. They spoke on condition of anonymity because the information concerns sensitive commercial arrangements.
One source said customers in China have accepted some of the steepest price rises. That pattern highlights how U.S. restrictions on exports of advanced chipmaking equipment to China have increased the reliance of Chinese firms on overseas foundries. The increases represent a notable shift for Samsung's foundry division, which industry estimates indicate has been loss-making since 2022, even as Samsung overall has reported record profits driven by higher prices for memory chips used in AI systems.
According to the sources, Samsung raised prices in July for chips produced on its 4-nanometre process, known internally as SF4. For SF4 customers in China and the United States, prices rose by 10% to 15% compared with the previous month, while customers in Taiwan saw increases in the range of 5% to 10%.
Price adjustments were not limited to SF4. The sources said wafer prices for the 5-nanometre SF5 process were increased by 10% to 15%, and wafers made on the older 8-nanometre node were up by nearly 10%.
Samsung did not provide comment, citing the company policy of not disclosing operational details.
Market position and leverage
Research cited by the sources indicates Samsung accounted for 7% of global foundry revenue in the first quarter of 2026, while TSMC generated more than 70%. With much of TSMC's leading-edge capacity booked by AI workloads, Samsung has gained leverage to adjust pricing.
Samsung projects that advanced process technologies will represent more than half of its foundry revenue this year. It also expects that AI and high-performance computing applications will account for over 30% of foundry revenue, up from roughly 15% to 20% in late 2025.
Lee Min-hee, a Seoul-based analyst at BNK Investment & Securities, said that as TSMC confronts tight capacity and raises prices, customers have been shifting some business to rivals such as Samsung and Intel, prompting Samsung to follow with its own price increases. Lee added that if Samsung continues to push prices higher, its foundry operations could become profitable as early as next year, sooner than previously anticipated.
Capacity and customer mix
One person familiar with Samsung's operations said the SF4 production line at the company's Pyeongtaek, South Korea, complex has been operating at full capacity since late last year. That line manufactures logic chips for customers including Qualcomm and also produces base dies used in Samsung's multi-layer high-bandwidth memory (HBM) chips.
Samsung told investors in July that the foundry unit is expected to return to profit in the near term, supported by higher factory utilization, improved production yields and firmer pricing. The company said that rising sales to major U.S. and Chinese customers, together with demand for HBM base dies, should help lift foundry revenue by more than double-digit percentage points in the second half of the year compared with the prior year period.
Improving yields have been a contributing factor in winning customers. The company signed manufacturing deals last year with Tesla and Apple, and in July announced an AI chip production agreement with Broadcom. Nvidia's chief executive also indicated earlier in the year that Samsung would manufacture his company's new AI inference processor.
One of the sources familiar with the recent price increases said Google is in talks with Samsung to manufacture chips using the SF4 process. Google did not respond to a request for comment.
Reporting on competitive dynamics and customer behavior suggests Samsung is leveraging constrained industry capacity to reprice advanced foundry work, while preserving output for internal use and core customers.