Samsung Electronics Co. (KRX: 005930)has bagged the first foundry order for its new factory that will be up and running later next year in Taylor, Texas, from American fabless startup Groq Inc., a move expected to further heat up foundry competition with its bigger rival Taiwan Semiconductor Manufacturing Co. (TSMC) in the US.

Samsung Device Solutions President poses with Williamson County Judge at Texas foundry construction site

Samsung's new US chip fab wins first foundry order from Groq

Groq announced that it has chosen the South Korean chip giant as its “next-gen silicon partner,” and the chips, its new AI chips, will be manufactured on the 4-nanometer (nm) process, or the SF4X process, at Samsung’s new chip factory under construction in Taylor, Texas.

This is the first order Samsung’s foundry business has won for its new chip manufacturing facilities in the US, which are scheduled to commence mass production in the second half of 2024.

Jonathan Ross, CEO and founder of Groq, stated, "The first-gen Groq LPU™ was built for AI from the ground up, enabling Groq to consistently outperform graphics processors on AI and ML tasks. Our partnership with Samsung will allow us to continue that leap forward, by tapping into the most advanced semiconductor manufacturing technologies available."

Marco Chisari, EVP of Samsung Electronics, Head of Samsung's US Foundry business and Head of Samsung Semiconductor Innovation Center shared, "Samsung Foundry is committed to advancing semiconductor technology and bringing groundbreaking AI, HPC, and data center solutions to market. This relationship with Groq is another proof point of how we're using our advanced silicon manufacturing nodes to bring new AI innovation to market."

The current generation of Groq hardware solutions continue to achieve orders of magnitude performance improvements over existing solutions at scale with a 2-4X power advantage. The next-gen silicon, to be designed in partnership with Samsung's Foundry Design Service team and manufactured by Samsung on its SF4X process (4nm), will utilize the revolutionary first-gen Tensor Streaming architecture. It is set to improve throughput, latency, power consumption, hardware footprint, and memory capacity. Additional technology and architectural improvements will increase the Language Processor Unit™ system's interconnect bandwidth, enabling Groq to build systems ranging from 85,000 to more than 600,000 chips, without any external switches and with significantly more cross-sectional bandwidth than today's exascale supercomputers.

The rivalry between Samsung and TSMC is fierce

The two foreign foundry majors are aggressively expanding their foundry business in the US after US President Joe Biden last summer signed into law the CHIPS and Science Act, which includes over $52 billion in semiconductor subsidies to boost chip manufacturing in the US.

TSMC originally planned to begin mass production at its first chip factory in Arizona by late 2024 but has pushed back its opening to 2025 due to a shortage of qualified and skilled workers.More

Samsung has committed a total $17 billion to construct the new chip factory in Taylor.  

Samsung’s latest win is expected to further intensify the two rivals’ race to win foundry customers in the US, said analysts.

Their rivalry is fierce, especially in advanced processing technology such as the 4 nm and finer 3 nm nodes. Samsung is known to have significantly improved the chip manufacturing yield for the 4 nm node.  

The world’s No. 1 foundry company TSMC and runner-up Samsung have vowed to begin mass production of advanced chips on the industry’s cutting-edge 2 nm technology in 2025.

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