Samsung Foundry raises manufacturing prices, may impact the Nintendo Switch 2

Samsung has raised prices on some of its advanced contract chipmaking services by as much as 15% for new orders, according to a Reuters report citing two people familiar with the matter. The increases took effect in July and are driven by a surge in AI chip demand, which is tightening capacity across the industry.

The hikes center on Samsung's 4nm SF4 process, where customers in China and the US saw price increases of 10 to 15% compared to the previous month. Taiwanese customers got a smaller bump of 5 to 10%. Samsung's 5nm SF5 line also rose 10 to 15%, while the older 8nm node climbed closer to 10%.

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Chinese customers are reportedly accepting the steepest increases. US export restrictions on advanced chipmaking equipment have limited what Chinese firms can access domestically, pushing more of them toward foreign foundries like Samsung. With fewer alternatives at the leading edge, they have less room to push back on pricing.

This is big for Samsung's foundry business, which has been unprofitable since 2022 as it struggled to close the gap with TSMC. TSMC's advanced-node lines have reportedly filled up with AI chip orders, and some customers appear to be turning to Samsung Foundry as a result. Samsung has also picked up manufacturing deals with Tesla, Apple, and Broadcom over the past year, and Google is reportedly in talks to use Samsung's SF4 node as well.

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The 8nm price increase is notable for regular consumers and gamers, since that's the same node Nintendo uses to manufacture the Switch 2's processor. Nintendo has already raised the console's price once this year, citing the ongoing memory shortage, and a pricier manufacturing contract with Samsung could add more pressure toward another increase.

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Samsung hasn't publicly confirmed the pricing changes, declining to comment on the report. However, these new prices seem to suggest that Samsung is finally in high demand, and it would be a notable turnaround for a division that's spent years undercutting TSMC's pricing just to stay competitive.