The Korea Herald


Samsung Electronics tops chip facility investment in 2021

By Kim Byung-wook

Published : Feb. 9, 2022 - 16:01

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Samsung Electronics’ chip plant in Pyeongtaek, South Korea. (Samsung Electronics) Samsung Electronics’ chip plant in Pyeongtaek, South Korea. (Samsung Electronics)

Samsung Electronics invested more money into its chip plants and equipment in 2021 than any of its competitors including Intel and TSMC.

According to the South Korean chip giant Wednesday, the company poured 43.6 trillion won ($36.4 billion) for upgrades to and the expansion of its chip plants in Korea and China where advanced DRAM chips and vertical NAND flash memory chips are produced. The funds were also used for the expansion of an advanced 5-nanometer production line at its foundry plant in Korea.

The 43.6-trillion-won investment accounts for roughly 46.3 percent of the money Samsung Electronics made by selling chips. Last year, the company posted record-breaking chips sales worth 94.1 trillion won, surpassing Intel to become the world’s No. 1 in chips sales for the first time in three years.

Meanwhile, global foundry dominant TSMC invested $30 billion for its chip plants and equipment, which is about 52.9 percent of its total chips sales of $56.8 billion last year.

Intel, which enjoyed $73.1 billion in chip sales last year, only reinvested $18.7 billion, the main reason it conceded No. 1 place to Samsung Electronics.

According to research firm Gartner, the three major chip players last year took up 60 percent of the world’s total chip infrastructure investments worth $146 billion. The competition is expected to only intensify as the US this year aims to pass a bill to attract chip factories on its soil in exchange for massive tax credits.

To address supply chains involving chips, the US Congress is preparing the US Chips Act, which offers refundable tax credits up to 40 percent of the cost of building a chip factory or buying chip manufacturing equipment in the US, which could mean billions of dollars in write-offs.

To benefit from the envisioned chip bill, TSMC is building a new foundry plant in Arizona worth $12 billion, while Intel is building two plants in the state worth a combined $22 billion. Samsung Electronics is building a foundry plant in Texas worth $17 billion.