Samsung Electronics Co. will be responsible for producing Qualcomm’s new 5G modem chips on its 5-nanometer (nm) process in a deal that would enhance its position in the foundry segment.

The Korean chip giant has bagged a contract from Qualcomm to fabricate Qualcomm X60 modem chips that will be used to connect electronic devices, such as smartphones, to 5G networks on its 5-nm process, reported Reuters on Tuesday (local time). The deal size was not disclosed.

Qualcomm, the world’s largest fabless chip designer, makes it also the largest client to foundries. Since Samsung Electronics set up its foundry business as an independent business in 2017, the two have kept up partnership from the 14-nm process to the 10-nm and the 7-nm.

With the latest order win from Qualcomm, the Korean chip maker is expected to further narrow its gap with dominant foundry leader TSMC of Taiwan. Whether TSMC also has share in the X60 supply is unknown.

TSMC dominated the largest 52.7 percent share in the global foundry market as of the quarter ended December last year, while Samsung Electronics commanded a 17.8 percent share, according to market research firm TrendForce.

The Korean tech giant has leapfrogged its chipmaking rivals in next-generation chip technology by becoming the world’s first to commercialize the 3-nm process in wafer fabrication last month. Samsung Electronics aims to start mass production of chips based on the bar-raising 3-nm fabrication next year, but TSMC is expected to join the ambitious roadmap only a year after in 2022.

By Chun Gyung-woon and Lee Ha-yeon

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