Samsung Faces Pressure as Foundry Market Share Declines in Q1 2025
Samsung’s foundry division is facing its most challenging period yet as market share slips and competition intensifies, particularly from China’s SMIC. The global foundry landscape is shifting rapidly, and Samsung’s once-secure second place is under threat.
Market Share and Revenue Trends
According to TrendForce, Samsung’s foundry market share dropped to 7.7% in Q1 2025, down from 8.1% in Q4 2024:
- TSMC strengthened its dominance with 67.6%, up from 67.1%.
- SMIC increased its share to 6.0%, up from 5.5%.
In revenue terms:
- Samsung’s sales declined 11.3%, falling from $3.26 billion to $2.893 billion.
- Meanwhile, SMIC posted modest growth, aided by competitive pricing.
A Shrinking Global Market
The overall foundry market contracted by 5.4%, with Q1 2025 sales totaling $36.4 billion:
- SMIC is benefiting from aggressive pricing and government subsidies.
- Samsung is caught between lagging behind TSMC in advanced nodes and losing cost-conscious clients to SMIC.
Strategic Challenges and Competitive Threats
SMIC’s strength lies in:
- Subsidized growth and strategic focus on mature process nodes.
- Rising US sales, which surged from 8.9% to 12.6% in Q1.
- Progress in advanced chip technologies, including 5nm production.
Samsung, by contrast, is under pressure:
- It lacks comparable government support.
- Its position in both mature and advanced process segments is weakening.
Expert Insights and Recommendations
Professor Lee Jong-hwan of Sangmyung University commented:
“Samsung’s foundry is in a tight spot. It needs to step up its design and tech game and focus more on what customers want.”
To regain its footing, Samsung must:
- Invest in cutting-edge design and fabrication technologies.
- Realign customer strategies to rebuild trust and meet demand.
Without decisive action, Samsung risks being overtaken by SMIC and losing further ground in the global foundry race.
