Samsung, Intel Held Talks to ‘Cooperate’ on Semiconductors: Report

Intel CEO Patrick Gelsinger met with Samsung Electronics Vice Chairman Lee Jae-Yong in South Korea on Monday to discuss how the two semiconductor giants can “cooperate” as the industry as a whole faces supply chain headwinds amidst a surplus of demand — reports Nikkei Asia.

“They discussed how to cooperate between the two companies,” Samsung Electronics said in a statement.

Intel is one of the world’s leading CPU makers, while Samsung specializes in memory chips and also commands a little under 20% of the global foundry business — the contract manufacturing of custom semiconductors for companies.

Samsung is looking to gain more ground in the foundry business, while Intel is looking to break into it under Gelsinger’s leadership. Fellow chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), which notably manufactures semiconductors for Apple, accounts for more than half of the global foundry business.

According to Samsung’s statement, the two bosses “exchanged opinions on next-generation memory chips, fabless system chips, foundry chips as well as those for PCs and mobile devices in a series of meetings.”

Last week, Samsung Group announced plans to expand its semiconductor, bio, and IT sector businesses with an investment of 450 trillion won ($363 billion USD) over the next five years.

A report from earlier this month indicated Samsung Electronics was negotiating price hikes of up to 20% for contract microprocessor fabrication to help cope with inflationary pressure on the costs of raw materials and logistics. TSMC hiked prices by a similar margin back in January.

10 days before the two companies held talks, U.S. President Joe Biden visited a Samsung semiconductor plant in Pyeongtaek as part of this three-day trip to South Korea.

Biden praised the factory as a good example of technological cooperation between the U.S. and South Korea. The Biden administration wants to bolster supply chains among “value-sharing” countries.

Analysts believe Gelsinger’s visit to Seoul is likely a move to build a more stable supply chain for Intel in the semiconductor industry.