Samsung Stock Rises as Google, AMD and BYD Ditch TSMC for Samsung Foundry

TLDR

• Samsung Electronics has received chipmaking inquiries from Google, AMD, BYD, and Tesla as TSMC faces capacity constraints driven by AI demand.
• Google is in talks with Samsung to produce its next-gen Axion processors and Tensor Processing Units, both targeted for around 2028.
• BYD is discussing future autonomous driving chip production with Samsung.
• AMD is in talks to have Samsung build some future CPUs.
• TSMC, Samsung, and Intel remain the only three chipmakers capable of advanced chip production at scale.

With AI infrastructure demand running hot, TSMC’s advanced chipmaking capacity is getting stretched — and Samsung is picking up the overflow.

Nikkei Asia reported Wednesday that Samsung Electronics has seen a surge in contract chipmaking inquiries from major global customers, including Google, AMD, BYD, and Tesla. The report cited six people with knowledge of the matter.

Samsung stock rose around 1% on the news.

Samsung Electronics Co., Ltd., SMSD.L

TSMC’s order book is heavily committed to existing customers — Nvidia, Apple, AMD, Broadcom, Marvell, and MediaTek among them — leaving little room for new orders in the near term. TSMC has outlined plans to expand capacity, but building semiconductor fabs is expensive and takes years. That crunch is sending some customers looking elsewhere.

What Samsung Is Being Asked to Build

Google is in discussions with Samsung about producing its next-generation Axion processors, expected to launch around 2028. Google is also considering using Samsung’s foundry for a portion of its Tensor Processing Units, the custom chips it uses for AI computing workloads, also targeting 2028.

AMD is in talks to have Samsung manufacture some future CPUs. BYD, the Chinese electric vehicle maker, is discussing production of its next-generation autonomous driving chips with Samsung. Tesla’s name also appeared in the report as one of the companies that has made inquiries.

These are early-stage discussions, not confirmed orders.

The Three-Way Race at the Top

TSMC, Samsung, and Intel are currently the only companies that can produce cutting-edge chips at scale. That’s a short list, and it gives all three meaningful leverage in a market where AI demand keeps climbing.

Intel has been working to attract external customers for its advanced chipmaking operations, though it primarily manufactures chips for its own use.

TSMC stock (TSM) fell about 3.5% on Wednesday. AMD (AMD) dropped around 7.3%, while Intel (INTC) slid 8.45%. GOOGL edged up 1.06%.

Samsung’s foundry business has faced yield and execution challenges in recent years, which pushed some customers toward TSMC in the first place. Whether these new inquiries translate into actual orders will depend on Samsung’s ability to deliver at the quality and volume customers need.

On TipRanks, TSMC holds a Strong Buy consensus rating with an average price target of $465, implying around 9% upside from current levels. TSMC stock is up about 40.7% year-to-date.

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