Samsung Electronics Inks $16.5 Billion Semiconductor Deal With Unnamed Global Client
Samsung Electronics has secured a $16.5 billion contract to supply semiconductors to a major global company, according to a regulatory filing. The South Korean tech giant did not reveal the client’s identity but confirmed that the agreement began on July 26, 2024, and will run through December 31, 2033.
Following the announcement, Samsung’s stock rose as much as 3.5% in Seoul—the company’s largest single-day gain in nearly a month, Bloomberg reported.
The deal, signed on Saturday, pertains to Samsung’s contract chip manufacturing business, also known as foundry services. While specific terms and the identity of the buyer remain confidential, Samsung stated that full details will be withheld until the contract concludes in 2033 to safeguard trade secrets.
“Because the core elements of the agreement remain undisclosed for business confidentiality reasons, investors should proceed cautiously, recognizing the possibility of modifications or cancellation,” CNBC quoted the filing.
Samsung’s Position in the Chip Market
Samsung is the world’s second-largest contract chip manufacturer, trailing only Taiwan Semiconductor Manufacturing Company (TSMC). The company’s foundry clients include major players such as Tesla and Qualcomm, whereas TSMC counts Apple and Nvidia among its top customers.
The timing of this announcement is significant, as Samsung continues to face competitive pressure in the artificial intelligence (AI) chip sector—a rapidly growing segment that has impacted its profitability and share performance.
According to analysts cited by Reuters, Samsung is losing market share to TSMC due to ongoing technological challenges in developing cutting-edge semiconductor processes.
The company is set to report its second-quarter earnings this Thursday and has warned that its profit may decline by more than half compared to the same period last year, as reported by CNBC.
