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On May 6th, it was reported that Samsung Foundry's business development seems to be in a difficult situation recently. Previously, the yield issue of its 3-nanometer process was well-known in the industry, which could lead to missing out on billions of dollars in orders from giants such as Qualcomm and Nvidia.

In addition to the challenges in advanced processes, Samsung's OEM also faces the problem of slowing demand for traditional processes. In order to reduce costs, the company had to shut down some production lines. Previously, it was reported that AMD was expected to use Samsung's fourth generation 4-nanometer process (SF4X) to produce chips, but according to the latest news, AMD has decided to abandon this plan.

The specific reasons behind AMD's decision to abandon its partnership with Samsung are currently unclear. Samsung OEM began mass production of SF4X process chips in March this year. Since 2021, Samsung has been producing 4-nanometer chips and continuously upgrading related process technologies. The latest 4-nanometer process adopts Back End of Line technology, which can reduce manufacturing costs and improve chip performance.

AMD originally planned to use Samsung's process to produce I/O chips for server CPUs, as TSMC's 4-nanometer process had limited production capacity and could not fully meet AMD's needs. In addition, Samsung has been fiercely competing with TSMC in terms of price to attract customers, so for AMD, Samsung may be a more cost-effective choice.

AMD has decided not to use Samsung's SF4X process to manufacture these chips, perhaps because AMD has successfully obtained additional production capacity from TSMC, or perhaps because AMD is renegotiating with Samsung for more favorable conditions. Regardless of the specific reasons, this decision undoubtedly adds new pressure to Samsung's already challenging business environment for contract manufacturing.