Samsung May Merge Its System LSI and Foundry Semiconductor Divisions

Last week, a report revealed that Samsung may make its Foundry division a completely independent business unit. However, it now appears that the Korean firm is leaning toward a merger of the System LSI and Foundry divisions. The former design chips, while the latter handles the manufacturing process. The company has not made a final decision yet, so things might change later.

Samsung’s DS division discusses possible reorganization of chip units

The System LSI division, which designs cutting-edge chips like the upcoming Exynos 2500, has been going through a tough time due to poor profitability. It has been under audit by Samsung Global Research’s Management Diagnosis Office since January of this year. While the results have not been published yet, discussions about the future of the division have already begun within the industry.

According to Korean media Sedaily, the senior management of Samsung’s DS division recently held a meeting to discuss the reorganization and operation of the System LSI division. “Since it was a critical matter that would determine the fate of the organization, it was not easy to reach a conclusion at this meeting, and I understand that they will hold another meeting soon to make a final decision,” an industry insider told the publication.

So, the DS division’s management has not decided yet on the future of its System LSI division. However, the report says the management team is currently reviewing several scenarios for the reorganization of the division. Meanwhile, industry experts see two possibilities: 1) moving the SoC business team, which designs the Exynos AP, to the Mobile eXperience (MX) division or 2) merging the System LSI division with the Foundry division.

The Korean firm may go with the second option, though there are concerns among Foundry customers. It is worth mentioning that the two divisions were part of the same unit until 2017. The reason Samsung may lean toward a merger is that both divisions now share a common and urgent goal of succeeding in the cutting-edge process below 2nm in order to survive. It will be interesting to see what decision Samsung ultimately makes.