.webp){kind=small}
$200 billion handshake that could reshape the AI chip race
Samsung Electronics has struck an agreement with Broadcom that could reshape the balance of power in the global AI chip supply chain. The partnership, expected to exceed $200 billion over five years through 2030, covers memory, contract chip manufacturing, and advanced packaging, essentially every major layer of production that matters in the AI era.
The memorandum of understanding was not signed quietly in a boardroom. It was announced at an AI summit held at The Midway in San Francisco, an event that doubled as a showcase of just how many major players now orbit Samsung's ambitions. South Korean President Lee Jae-myung attended, alongside Samsung Electronics Chairman Lee Jae-yong. Also present were Nvidia CEO Jensen Huang, OpenAI CEO Sam Altman, Hyundai Motor Group Chairman Chung Euisun, Naver Chairman Lee Hae-jin, and SK Chairman Chey Tae-won. The scale of that guest list says as much about the moment as the dollar figure does.
Who actually signed the deal
The agreement itself was signed by Jinman Han, President and Head of Samsung Electronics' Foundry Business, and Broadcom CEO Hock Tan. Jun Young-hyun, Vice Chairman and CEO of Samsung's Device Solutions Division, framed the partnership as proof that tightly integrating memory, logic, and advanced packaging has become the defining competitive edge of the AI era. On Broadcom's side, Charlie Kawwas, President of its Semiconductor Solutions Group, described the deal as a natural response to how quickly AI infrastructure is scaling and how important ecosystem-wide collaboration has become.
What Samsung will actually build
On the memory front, Samsung will supply Broadcom with next-generation high-bandwidth memory, including HBM4 and HBM4E, to power Broadcom's AI accelerators. On the foundry side, Samsung will manufacture Broadcom products, including its Wireless Broadband Communications solutions, using 2-nanometer and smaller process nodes at its Pyeongtaek campus in South Korea. The partnership also extends into advanced packaging, including 2.3D and 2.5D integration techniques built on that same 2-nanometer foundation, aimed at maximizing performance and power efficiency for AI and networking chips.
Why Broadcom looked beyond TSMC
Broadcom had historically entrusted its most advanced chip processes almost entirely to TSMC. Analysts point to Samsung's status as an integrated device manufacturer, one company handling memory, foundry, and packaging together, as the key differentiator that won Broadcom over, since it shortens development cycles and improves power efficiency compared to coordinating separate vendors. Reporting also suggests TSMC's recent decision to raise foundry prices by as much as 10 percent starting in 2027 made Samsung's offer considerably more attractive on cost grounds alone.
A bigger week for Korean chipmakers
Samsung wasn't the only Korean chipmaker cutting deals that week. SK Hynix also extended an HBM4 supply agreement with Microsoft around the same summit, part of a broader wave of Korean chip agreements reportedly totaling roughly $950 billion in combined US-linked commitments. SK Hynix still holds the dominant share of the global HBM market, around 56 percent by revenue as of early 2026, with Samsung holding a considerably smaller slice. That imbalance is exactly why this Broadcom deal matters so much to Samsung's memory ambitions, not just its foundry business.
The stakes for Samsung going forward
Samsung's chip division has already posted record quarterly profit this year on the back of AI-driven demand, even as other parts of the company, notably mobile, have faced tougher conditions. The company previously landed a $16.5 billion contract to build logic chips for Tesla, and Jun Young-hyun revealed last month that he had also discussed next-generation foundry cooperation with Nvidia's Jensen Huang, including potential future work on HBM4E and HBM5.
Winning a customer of Broadcom's size gives Samsung sustained utilization on its most advanced manufacturing lines, something it has struggled to secure consistently against TSMC. Whether this translates into a lasting shift in market share will likely come down to execution, particularly yield rates at the cutting-edge nodes now underpinning the entire deal. For now, Samsung has a headline win, and a room full of the industry's most powerful people to back it up.
