Samsung to Manufacture Chips for Apple at Austin Facility

Samsung has struck a significant chip manufacturing deal with Apple. The company will produce advanced chips for the iPhone maker at its semiconductor facility in Austin, Texas. This is a big win for the Korean foundry, helping US business expansion ambitions and recovering lost market share in recent years.

Apple partners with Samsung for chip production in Austin

In a press release, Apple said that it is collaborating with Samsung at its semiconductor factory located in Austin, Texas. “We are developing innovative new chip manufacturing technology that will be used for the first time in the world,” the company noted. This technology will improve the power efficiency and performance of upcoming Apple products, including iPhones.

While Apple did not disclose details about the chips, industry analysts expect Samsung will make image sensors for next-generation iPhones. So far, Sony has been the key supplier for Apple’s image sensors. It looks like the Cupertino giant now wants to diversify its supply chain so it can reduce dependence on a single supplier.

Samsung has yet to comment on this matter. “We cannot confirm the client’s name or other detailed specifics regarding the orders,” the company noted. Industry analysts also expect that Samsung’s System LSI division will design those image sensors. If true, the company’s chip design unit will also earn revenue from this deal.

Meanwhile, Samsung is gearing up to begin operation at its new semiconductor hub in Taylor, Texas. The company is actively looking for clients so it can secure long-term production volume. It recently secured a deal with Tesla (valued at $16.5 billion) to manufacture the carmaker’s next-gen AI6 chips. This massive deal will definitely help Samsung make a comeback in the semiconductor space.

In recent years, Samsung has faced stiff competition from industry leader TSMC, leading to a substantial drop in both market share and revenue. Now that it has received orders from multiple global tech giants, the company’s future for its foundry business looks promising.