Samsung Electronics Co. has entered into a $16.5 billion agreement to manufacture AI semiconductors for a major undisclosed customer.
On Monday, South Korea’s largest company announced that it had it signed a foundry contract and secured the 22.8 trillion won chip production deal, which will extend through the end of 2033.
The contract represents 7.6% of Samsung Electronics’ total revenue of 300.9 trillion won in 2024, making it the largest chip order in the company’s history. It is expected to provide a significant boost to Samsung’s foundry division, which has long lagged behind industry leader Taiwan Semiconductor Manufacturing Company (TSMC).
In its earnings guidance earlier this month, Samsung Electronics projected a second-quarter operating profit of 4.59 trillion won and sales of 74 trillion won. However, the operating profit fell short of market expectations, primarily due to weak performance in the foundry and System LSI (Large Scale Integration) divisions.
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