Samsung Foundry Eyes Profitability in 2028 as 2nm Yields Improve

Samsung Foundry executives have signaled that the division may finally achieve profitability in 2028, marking a potential turning point for the company's semiconductor manufacturing business. The outlook remains challenging for the immediate future, with leadership acknowledging that next year will likely remain difficult for generating profits. This projection comes from Han Jin-man, president of Samsung's Device Solutions division, who addressed employees regarding the long-term financial trajectory of the foundry operations.

Executive cites performance bonuses and mobile focus as key hurdles to earlier gains

The path to profitability relies heavily on improvements in advanced manufacturing processes and better utilization of existing technology nodes. Samsung has reported that yields for its 2nm Gate-All-Around process are improving, which helps support the foundry's financial health. The company is also seeing increased usage of its mature 4nm and 8nm production lines, providing additional revenue streams while advanced node adoption scales up.

Despite these technical improvements, internal corporate structures continue to impact the division's bottom line. Han Jin-man identified performance-based bonuses, which account for 10.5 percent of annual operating profit, as a significant factor delaying earlier profitability. He also cited other internal hurdles, including a business structure that is too focused on mobile devices and strategies that lack sufficient maturity or effectiveness.

Market positioning remains a critical challenge as Samsung competes against industry leader TSMC for major semiconductor contracts. Currently, the company is primarily viewed by clients as a backup option rather than a primary alternative due to reliability concerns. Industry observers note that Samsung must demonstrate higher yield rates, potentially reaching a 70 percent mark, before it can be considered a viable direct competitor in the high-end foundry market.