Samsung Electronics raised prices for advanced contract chipmaking services by up to 15 percent for new orders in July, according to two people familiar with the matter. The increases apply to chips made using Samsung's 4-nanometer SF4 process and its 5-nanometer SF5 process, the nodes it uses to compete with Taiwan Semiconductor Manufacturing Co. for high-end logic chip production.
Customers in China and the United States saw SF4 wafer prices rise 10 to 15 percent from the prior month. Customers in Taiwan—home to TSMC and its supplier ecosystem—saw smaller increases of 5 to 10 percent. SF5 wafer prices rose 10 to 15 percent across the board, while prices for Samsung's older 8-nanometer technology rose by nearly 10 percent.
Demand from Chinese customers has been especially strong, but Samsung cannot fill all of those orders. The company must prioritize U.S. customers and reserve a portion of its capacity for its own internal chip production, one of the sources said. Chinese customers are accepting the steepest price increases—a direct consequence of U.S. export controls on advanced chipmaking equipment, which have pushed Chinese firms toward overseas foundries they can still access.
The price hikes mark a reversal for Samsung's foundry division, which has been a loss maker since 2022. The unit has struggled to close the gap with TSMC even as Samsung's overall business reported record profits, driven by high prices for memory chips used in AI systems. Cutting prices to attract customers was the foundry division's primary competitive tool for years. That tool is now off the table.
Samsung held 7 percent of global foundry revenue in the first quarter of 2026, against more than 70 percent for TSMC, according to Counterpoint Research. The SF4 line at Pyeongtaek has been running at full capacity since late last year, which is why new customers face higher prices—there is no slack production to offer at a discount.
The constraint is TSMC's backlog. AI chip demand has consumed much of TSMC's leading-edge capacity, leaving customers who cannot secure TSMC slots with fewer alternatives than two years ago. Samsung now expects advanced processes—its sub-5nm nodes—to account for more than half of foundry revenue this year. AI and high-performance computing applications are projected to make up more than 30 percent of foundry revenue in 2026, up from 15 to 20 percent in late 2025.
Logic chips for smartphones and consumer electronics drove foundry revenue for most of the last decade. AI accelerators, custom data center silicon, and high-performance computing chips are now the growth workload, and they require the most advanced process nodes Samsung offers.
The economics of this shift favor Samsung's pricing power in one specific way: customers who need 4nm and 5nm silicon for AI applications have no credible alternative if TSMC is full. Intel Foundry remains in early stages of winning external customers at leading-edge nodes and does not yet represent a realistic substitute for production at scale. That leaves Samsung as the only other foundry running high-volume advanced-node production.
Samsung declined to comment, saying the company does not provide details on operational matters.
The foundry division's path to profitability runs through exactly this pricing environment. A business that lost money for four straight years while cutting prices to compete now has customers absorbing double-digit price increases rather than walk away. Whether the division can sustain those prices depends on whether TSMC's capacity constraint holds—and on how quickly Intel Foundry can attract volume customers at advanced nodes, which would restore competitive pressure on Samsung's pricing.
