Samsung Electronics is reportedly going to produce CPUs (Central Processing Unit) for PCs for Intel. Although there is a case where Intel signed a contract with Samsung Electronics regarding foundry production of simple components, this is the first time that it will be entrusted with consignment production of CPUs for major system semiconductors.
According to industry sources on Nov. 28, Intel has decided on consignment production in addition to its own production and is working with global foundry companies such as Samsung Electronics and TSMC in Taiwan as the supply of CPUs for PCs has become serious.
In an apology issued in the name of Michael Johnston, vice president of Holthouse, on Nov. 20 after PC makers such as Hewlett-Packard and Lenovo criticized the lack of CPU supply, Intel said, "We are increasing the use of foundry while admitting to failure in forecasting the demand."
Samsung Electronics and Intel are also competing for the top position in the global semiconductor industry, which combines memory and non-memory.
Samsung Electronics, which ranked No. 1 in 2017 and 2018, is expected to give up its top position to Intel this year due to sluggish memory sales.
Although Intel increased CPU production by double digits in the second half of the year, its supply was still delayed, so that it rushed to produce CPUs consigned to Samsung Electronics.
Among the world's foundry companies, there are TSMC, which is the world's No. 1 company, and Samsung Electronics, which are the world's second largest, and Global Foundry, which is the third largest.
"We expect a drop-off effect due to TSMC's lack of production capability. Possibilities of outsourcing of Intel chips will be expanded next year after Qualcomm," said an official of KTB Investment & Securities.
Samsung Electronics announced in April that it would invest 133 trillion won to become the world's top company by 2030 to strengthen its system semiconductor business competitiveness.