Qualcomm Embraces Dual-Foundry Strategy with Samsung
Qualcomm is reportedly set to diversify its manufacturing strategy by partnering with Samsung to produce its flagship Snapdragon 8 Elite Gen 5 chipset using Samsung’s advanced 2nm Gate-All-Around (GAA) process. This move marks a significant collaboration between the two companies after several years, signalling a shift towards a dual-foundry approach for Qualcomm’s high-end processors. The design work for the Snapdragon 8 Elite Gen 5 has been completed, and discussions are underway to commercialise the chip soon, according to Qualcomm CEO Cristiano Amon during CES 2026.
Key Details on Samsung’s 2nm Manufacturing and Qualcomm’s Plans
Samsung’s 2nm GAA technology, which is also being used for the Exynos 2600, represents a cutting-edge advancement in semiconductor fabrication. Although initial yields were around 50 percent, improvements are expected as production matures. Samsung plans to allocate about 10 percent of the manufacturing capacity at its Hwaseong S3 fab to produce the Snapdragon 8 Elite Gen 5, which is currently manufactured by TSMC on its 3nm process. Notably, Samsung has priced its 2nm wafers at approximately $20,000, significantly undercutting TSMC’s $30,000 wafer cost, potentially making it a more attractive option for Qualcomm and other customers.
Context and Industry Implications
This collaboration could generate around $470 million in revenue for Samsung, reinforcing its position in the competitive foundry market. Samsung has recently secured several high-profile contracts, including a $16.5 billion deal with Tesla for AI chips and orders from Chinese cryptocurrency equipment manufacturers. These deals indicate that Samsung’s manufacturing processes, both new and established, have stabilised and regained customer confidence. For Qualcomm, this dual-foundry strategy could help manage costs and supply chain risks as its flagship chipsets, like the Snapdragon 8 Elite Gen 6 Pro, are rumoured to become even more expensive than their predecessors.
Looking Ahead
The partnership between Qualcomm and Samsung for the Snapdragon 8 Elite Gen 5 production on 2nm GAA technology is a noteworthy development in the semiconductor industry. It reflects Qualcomm’s strategy to diversify its manufacturing sources and Samsung’s ambition to expand its foundry business. As production ramps up, it will be interesting to see how this affects the pricing and availability of Qualcomm’s flagship processors and whether Samsung can further improve its yields to meet demand effectively.
Source: @jukan05