Samsung to Expand 2nm and 1.4nm Chip Production Amid Global Shortages

The South Korean tech giant is adjusting its manufacturing strategy in response to strong demand from semiconductor designers. According to South Korean media citing company representatives, the current pace of production is trailing actual market needs, prompting Samsung Foundry to expand its manufacturing facilities.

Texas Cluster Expansion and Gradual Scaling

The primary site for manufacturing advanced nodes will be the company’s U.S. fab in Taylor, Texas. This year, Samsung intends not only to launch its first contract chip manufacturing facility there, but also to begin construction on a second adjacent site. The U.S. facilities will produce 2nm products, among others.

Demand for the 1.4nm process node is also rising. In response, the South Korean chipmaker is considering further expansion of the corresponding production lines. However, the capacity increases are planned to occur gradually, following actual orders rather than building ahead of market demand.

According to internal company projections, order volumes for 2nm chip manufacturing are expected to double in 2026 compared to the previous year.

Company Expects Profit Surge

In the second half of the year, Samsung expects a substantial improvement in the financial performance of its foundry business.

A major driver behind this shift is the growing focus on AI and high-performance computing (HPC). By the end of the year, the AI segment is projected to account for over 30% of Samsung Foundry’s revenue, up from 20% the previous year. Analysts view this diversification as a positive move, as it reduces the company's heavy reliance on the mobile processor market.