SamMobile has affiliate and sponsored partnerships. If you buy something through one of these links, we may earn a commission. Learn more.

Fraud at Samsung’s chip division under investigation after huge order loss

Business
By 

Last updated: February 23rd, 2022 at 10:40 UTC+02:00

It seems all may not be well at Samsung’s chip division. Samsung has been investing heavily in improving its foundry capabilities. It wants to challenge TSMC to become the leading contract chip manufacturer in the world. The battle hasn’t been easy and TSMC is proving to be a tough competitor.

Samsung needs everything to go as planned if it wants to succeed in its plans. However, in recent weeks, the chip division has suffered setbacks. Recent reports reveal that major contract chip manufacturing orders have been lost due to yield issues. It turns out that there may be more here than meets the eye.

Were the funds allocated for improving yields misused?

According to a report out of South Korea, Samsung has launched an investigation into potential fraud by executives at Samsung Foundry. It’s said that the executives may have fabricated data for 5nm and 4nm chip yields so that the funds allocated by Samsung to improve yields could be misplaced.

The yield is a measure of the efficiency of a chip process. It refers to the number of chips in a wafer that achieve the required quality testing standards. Foundries closely evaluate yields during early production runs on a new process technology before full-scale manufacturing begins.

A report yesterday claimed that Qualcomm had shifted some orders for its 4nm Snapdragon 8 Gen 1 from Samsung to TSMC. Yields for the chipset are reportedly at a dismal 35% – meaning that out of 100 pieces manufactured, only 35 are usable. Yields for Samsung’s own 4nm Exynos 2200 are said to be even lower.

It’s also believed that Qualcomm has decided to not use Samsung Foundry for its 3nm chips. All orders for its next-gen 3nm chips have gone to TSMC. That’s a significant business loss for Samsung Foundry which has long been trying to break TSMC’s stronghold on the market.

Samsung’s investigation aims to ascertain whether current and former executives at the division falsified reports about 5nm and 4nm yields to give the impression that there were no issues. The company would then be able to figure out where the funds allocated for improving yields went.

No further details about the investigation have been revealed as yet. Samsung Electronics told the scribe that such management consulting exercises are performed regularly and that no further details can be shared at this time.

Join SamMobile’s Telegram group and subscribe to our YouTube channel to get instant news updates and in-depth reviews of Samsung devices. You can also subscribe to get updates from us on Google News and follow us on Twitter.

Business Samsung Foundry
Load 2 comments

You might also like

Investors worry Samsung’s chip division has lost its ability to innovate

Market watchers and investors are worried that Samsung Electronics is losing its grip on the semiconductor market. More so, Samsung is reportedly losing ground due to internal issues rather than external factors driven by the competition. Critics worry that the Korean tech giant, particularly its chipset division, has lost its ability to innovate under Lee […]

  • By Mihai Matei
  • 1 week ago

Despite slowing smartphone sales, Samsung achieves its best ever Q2 profit since 2018

After revealing its earnings guidance a few days ago, Samsung announced its earnings for Q2 2022 earlier today. The company said that its revenue was KRW 77.2 trillion (around $59.1 billion), its best ever for second-quarter figures. The South Korean firm’s revenue was a 21% improvement compared to Q2 2021. The company’s Q2 2022 profit […]

  • By Asif Iqbal Shaik
  • 2 weeks ago

Samsung is helping domestic fabless chip firms create prototype designs

In another bid to foster domestic growth, Samsung’s chipset foundry division has decided to help a few South Korean fabless chip design houses create prototypes and validate pre-production concepts at reduced costs. After a selection process of a few weeks, Samsung chose to help five fabless chip design houses, including DeepX, GLS, SKAi Chips, Semibrain, and […]

  • By Mihai Matei
  • 2 weeks ago

Samsung faces more competition as Intel enters the contract chip manufacturing space

Samsung Foundry is the world’s second-biggest contract chip manufacturing firm. While the company is spending hundreds of billions of dollars to defeat its primary rival, TSMC, it has found a new competitor in the space: Intel. The company used to design and manufacture its own chips, and last year, Intel opened its foundry service for […]

  • By Asif Iqbal Shaik
  • 2 weeks ago

Samsung ships its first set of 3nm chips, marking an important milestone

Last week, it was revealed that Samsung will unveil the world’s first 3nm chips on July 25. Today, the South Korean firm held a ceremony for the first shipment of its 3nm GAA chips. The ceremony was held at the company’s V1 line at Hwaseong Campus in Gyeonggi-do province in South Korea. The event was […]

  • By Asif Iqbal Shaik
  • 2 weeks ago

Samsung could build 11 chip factories in the US with an investment of $200 billion

Samsung recently started working on its $17 billion semiconductor chip plant in Texas. However, the company’s investment plans don’t end there. The South Korean firm reportedly has plans to build as many as 11 chip factories in the state over the next ten years. A new report from Austin American Statesman claims that Samsung could […]

  • By Asif Iqbal Shaik
  • 3 weeks ago