Samsung Raises Chip Prices Amid AI Chip Demand Surge

Aug 19 – In a significant move, Samsung Electronics has increased prices for some advanced contract chipmaking services by up to 15% for new orders, according to two people familiar with the matter. This price hike is attributed to the growing demand for AI chips, which has tightened capacity in the business dominated by Taiwan Semiconductor Manufacturing Co (TSMC).

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Chinese customers, particularly, have been driving demand for Samsung’s chips, but the company has been unable to meet all orders due to its need to serve U.S. customers and reserve part of its capacity to support its own chip production. The sources, who spoke on the condition of anonymity, pointed out that U.S. curbs on exports of advanced chipmaking equipment to China have increased local firms’ reliance on overseas foundries.

The price hikes mark a turnaround for Samsung’s foundry business, which has been a loss maker since 2022, according to industry estimates. Despite this, the division has struggled to narrow the gap with TSMC, even as Samsung reported record profits driven by soaring prices for memory chips used in AI systems.

Samsung raised prices in July for chips made using its 4-nanometre process, known as SF4. Prices for SF4 customers in China and the U.S. were increased by 10% to 15% from the previous month, while customers in Taiwan, home to TSMC, saw increases of 5% to 10%. Prices for wafers produced by its 5-nanometre SF5 process rose by 10% to 15%, while those for its older 8-nanometre technology rose by nearly 10%.

According to a source, Samsung’s SF4 production line at its Pyeongtaek, South Korea, plant has been running at full capacity since late last year. The line produces logic chips for customers including Qualcomm as well as base dies used in Samsung’s own multi-layer high-bandwidth memory (HBM) chips.

The improved production yields have helped Samsung win customers. Tesla and Apple unveiled chip manufacturing deals with Samsung last year. Samsung also announced an AI chip production deal with Broadcom in July, while Nvidia CEO Jensen Huang said in March that Samsung would manufacture its new AI inference processor. Google is also in talks with Samsung to manufacture chips using SF4.

Industry Analysts Weigh In

Lee Min-hee, a Seoul-based analyst at BNK Investment & Securities, stated, ‘As TSMC faces tight capacity and raises prices, customers are shifting to rivals such as Samsung and Intel, prompting Samsung to raise its prices as well.’ He added, ‘If Samsung raises prices from here, its foundry business could potentially become profitable as early as next year, earlier than previously expected.’

Samsung’s foundry business has struggled to narrow the gap with TSMC, even as the company reported record profits driven by soaring prices for memory chips used in AI systems. However, with demand for AI chips booking up much of TSMC’s leading-edge capacity, Samsung has more leverage to raise prices.

Key Statistics

• Samsung produced 7% of global foundry revenue in the first quarter of 2026, compared with more than 70% for TSMC, according to research firm Counterpoint.
• Demand for AI chips has booked up much of TSMC’s leading-edge capacity, while Samsung expects advanced processes to account for more than half of foundry revenue this year.
• AI and high-performance-computing applications would make up more than 30% of foundry revenue this year, up from 15% to 20% in late 2025.