Samsung Foundry might be having major issues at Texas chip plant

In recent news (via Business Korea), Samsung supposedly withdrew personnel from the Texas chip manufacturing facility because of delays and slow progress concerning the yield of 2nm-based chips.

Despite its efforts and investments of billions of dollars in the Texas plant, Samsung Foundry's yield for 2nm GAA chips is around 10-20%, according to industry insiders.

This figure is too low to even get close to becoming competitive against rival TSMC, and industry watchers say the low yield won't help Samsung secure orders. In other words, Samsung's factory in Texas isn't mass-producing 2nm chips and won't be doing so for a while.

As such, reports say that the company decided to cut down on personnel from the plant, leaving only a small workforce active while Samsung rethinks its strategy. The foundry business may have pushed back its mass production plans for 2nm chips from 2024 to 2026. A two year delay could cost the company greatly in its race against TSMC.

Expert blames Samsung's bureaucracy and low compensation

Considering Samsung's massive resource pool, not to mention a promise of $7 billion worth of subsidies from the US CHIPS Act, it's hard to believe that the tech giant's Foundry business would face such difficulties.

Not only is Samsung having trouble with the 2nm process, but other reports say that Samsung's yield rate for 3nm-based chips is also abysmal, going as low as 20%, and reportedly forcing Google to pick TSMC to manufacture its next Tensor chip. TSMC has a 3nm yield rate of around 80%.

This poor performance at the Texas factory poses a risk of Samsung losing its $7 billion subsidy. Samsung is supposed to meet some prerequisites before it can claim the $7 billion, and it has yet to do that.

More details after the video

An anonymous semiconductor professor cited by the Korean media claimed that Samsung's failure was caused by pervasive bureaucracy, slow-decision making, and low compensation.

More so, the industry expert claims that the delayed investment timing compared to a couple of decades ago “indicates that the management is not fully aware of the current reality […].” The current situation, said the expert, calls for a “fundamental overhaul” of Samsung's management system.