Samsung Electronics is reportedly pursuing a plan to convert its U.S. Taylor Foundry process from 4 nanometers (nm) to 2 nm, as part of a strategic move to enhance its competitive edge against TSMC and Intel. This shift targets key foundry customers such as NVIDIA, AMD, and Qualcomm, who are increasingly demanding cutting-edge semiconductor technologies.
According to industry sources on June 18, Samsung is contemplating changing the process at its Taylor Foundry facility. The final decision on whether to implement the 2nm process is expected as early as the third quarter of this year.
The Taylor Foundry, which began construction in 2022 following an investment decision in 2021, was initially planned to commence phased operations by the end of 2024. Kye Kye-hyun, former head of Samsung’s DS division, shared a photo of the construction progress last year, indicating that 4nm mass production products would be shipped from the site by late 2024.
However, multiple semiconductor industry officials have noted delays in equipment orders for the Taylor facility, suggesting that Samsung is reassessing its plans to upgrade from 4nm to 2nm processes. This move is interpreted as a response to the rapidly growing artificial intelligence (AI) market, which is driving significant changes in semiconductor demand.
AI semiconductors, primarily used in data centers, are anticipated to expand into devices such as smartphones and PCs, necessitating advanced manufacturing processes like 2nm to meet performance requirements. Additionally, sluggish demand for 4nm processes may have influenced Samsung’s decision to consider the upgrade.
“The Taylor factory’s process ultimately depends on which customers it attracts,” an industry official commented, highlighting the market-driven nature of the decision.
As Samsung Electronics evaluates this process conversion, attention is on the operational timeline of the Taylor plant. Equipment changes are critical, and semiconductor factories require substantial time to stabilize. At its first quarter performance briefing in April, Samsung indicated preparations for gradual operation of the Taylor plant based on customer order status, with initial mass production anticipated in 2026.
Samsung has committed to expanding the Taylor facility, securing $6.4 billion (approximately 9 trillion won) in U.S. government subsidies, conditional on a total investment of over $40 billion (around 55 trillion won) by 2030. The potential delay in investment due to the process conversion raises questions about the impact on these commitments.
A Samsung Electronics spokesperson declined to comment on specific plans, stating, “It is impossible to confirm plans to build a semiconductor factory, including process nodes.”
As the semiconductor market continues to evolve, Samsung’s strategic decisions will be crucial in maintaining its competitive position and meeting the growing demands of AI and other advanced technology sectors.
