Samsung Electronics raised prices for some advanced chipmaking services by up to 15% for new orders, as surging AI demand fills key production lines and pushes customers toward alternatives to capacity-constrained Taiwan Semiconductor Manufacturing Co. (NYSE:TSM).
Prices for U.S. and Chinese customers using Samsung’s 4-nanometer SF4 process rose 10% to 15% in July, while 5-nanometer wafers climbed by a similar amount, Reuters reported Wednesday. Samsung declined to comment.
Samsung’s Seoul-listed shares tumbled 7.8% Wednesday as the KOSPI sank 5.8%, despite fresh evidence that AI infrastructure demand remains strong.
Investors are questioning the scale of AI spending even as chipmakers struggle to keep up with it.
Full Production Lines Give Samsung Pricing Power
Samsung’s SF4 line at its Pyeongtaek plant has reportedly run at full capacity since late last year. Demand from China is so strong that Samsung cannot fill every order, according to Reuters, because it must reserve capacity for U.S. customers and its own HBM base dies.
Samsung expects AI and high-performance computing applications to account for more than 30% of foundry revenue this year, up from 15% to 20% in late 2025.
That marks a reversal for a foundry unit that has reportedly lost money since 2022. Lee Min-hee, an analyst at BNK Investment & Securities, said further increases could make the business profitable as early as next year.
TSMC Is Full, and That Is the Opportunity
Samsung produced just 7% of global foundry revenue in the first quarter, versus more than 70% for TSMC, according to Counterpoint. TSMC CEO C.C. Wei told analysts last month that the gap between demand and supply is “so big” the company is racing to narrow it.
TSMC’s capacity crunch is turning Samsung into an increasingly important second source. Qualcomm Inc. (NASDAQ:QCOM) already uses its SF4 line, while Samsung manufactures Nvidia Corp.’s (NASDAQ:NVDA) new AI inference processor on its 4nm process.
Tesla Inc. (NASDAQ:TSLA) signed a roughly $16.5 billion chipmaking deal with Samsung last year, while Google’s parent Alphabet Inc. (NASDAQ:GOOG) is reportedly in talks to use SF4.
Prediction markets point to continued expansion. Kalshi traders give a 52% chance that the U.S. ends 2026 with at least 5,400 active data centers, roughly 25% above the market’s June 1 baseline of 4,313.
Why the Stock Fell Anyway
The Korean selloff was considerably sharper than moves in U.S. chip stocks Wednesday. Broadcom was down about 4.5% in afternoon trading, Intel nearly 4% and Micron nearly 2%, while Nvidia and TSMC were down less than 1%.
Fellow Korean chipmaker SK Hynix Inc. (NASDAQ:SKHY), which plunged 9.75% in Seoul, subsequently unveiled a 40 trillion won ($28.6 billion) share buyback and cancellation plan. EToro analyst Josh Gilbert said the scale suggests SK Hynix does not expect memory pricing to roll over soon.
Samsung may not need to catch TSMC to win from the AI boom. It may only need TSMC to stay full.
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