Samsung significantly reduces its wafer foundry investment by over 50% in 2025
Samsung Electronics announced a significant reduction in facility investment for its wafer foundry division in 2025, cutting it by more than half compared to the previous year. Samsung's wafer foundry has set its facility investment budget for 2025 at around 5 trillion Korean won, a significant decrease from the 10 trillion Korean won invested in 2024.

This decision was made after a significant investment from 2021 to 2023, during which Samsung spent approximately KRW 20 trillion on wafer foundry to expand production capacity and advance technology. However, in its Q3 2024 financial report in October 2024, Samsung Electronics has predicted a conservative facility investment approach, stating that "the scale of facility investment is expected to decrease in 2024, and we will maximize the use of existing production infrastructure by 2025
The OEM investment in 2025 will be concentrated in Huacheng S3 Factory and Pingze P2 Factory. At S3 factory, some 3nm production lines will be converted to 2nm. This conversion involves adding some equipment to the existing production line, which is not considered a large-scale new investment. At the P2 factory, it is planned to install a 1.4nm testing line with a monthly production capacity of 2000-3000 wafers within this year. In addition, Samsung will also make small-scale investments to supplement various equipment and infrastructure at its Taylor factory in the United States.
The main reason for Samsung's reduction in facility investment is the sluggish customer orders. Samsung's contract manufacturing plants have recently faced issues with low yield rates and delays in advanced processes, which have hindered their ability to attract "large tech" customers. The operating rate of the 4nm~7nm OEM factory located in Pingze has decreased by more than 30%, further exacerbating the situation.
The more pressing concern for Samsung's contract manufacturers is the widening gap with leading contract manufacturer TSMC. Last year alone, TSMC's investment in foundries reached NT $956 billion (approximately KRW 42 trillion), which is four times the investment amount of Samsung's foundries during the same period. This significant investment by TSMC highlights the competitive pressure Samsung faces in the global semiconductor market.
Industry insiders explain that "Samsung's OEM seems to have not significantly reduced its investment, but rather prioritized improving its competitiveness in 2nm technology." This strategic focus is on promoting 2nm technology, which is seen as a key measure to enhance Samsung's position in the market and address its current technological challenges.