Samsung prepares to raise production prices for chips by up to 20%

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Samsung appears to be joining the rest of the chip manufacturing industry in raising the price of semiconductor manufacturing as chip foundries increase the production costs of key components used in modern electronic devices.

The global semiconductor crisis has prompted many chip manufacturers to raise their prices in 2021 and 2022. On Friday, a report indicated that Samsung will finally follow the pack and make its own price increases.

Samsung is reportedly in talks with customers to raise semiconductor prices, with the increases potentially reaching 20% ​​more than usual, sources familiar with the matter said. Bloomberg† Depending on the difficulty of production, such as advanced designs, and other factors, the cost increase for customers can be between 15% and 20%.

While heavier designs will cost more, it also appears that those requesting production with legacy nodes will also see greater price increases than those using newer nodes for their designs.

The new prices may apply from the second half of 2022, sources say. Negotiations are underway, with Samsung apparently still in talks with some customers but closing talks with others.

Samsung has remained relatively stable with its prices in 2021, while other companies have pushed ahead to raise prices. However, multiple risks, including the war in Ukraine and lockdowns in China, are making it harder for Samsung to weather the storm.

As one of the largest semiconductor manufacturers, price changes could potentially impact the terminal dues of products sold to consumers. Apple chip partner TSMC, which rivals Samsung at the top of the industry, began raising its prices in August 2021, a move that has a chance to influence “iPhone 14” pricing.

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