South Korean tech giant Samsung Electronics Co. is looking to increase the use of its mobile application processor (AP), Exynos, as the price of APs for smartphones continues to rise.

According to Samsung Electronics‘ 2023 business report on Thursday, the company’s Device Experience (DX) division spent 11.73 trillion won ($8.87 billion) on mobile AP solutions in 2023.

The DX division is responsible for various consumer electronics products, including Galaxy smartphones, while mobile APs serve as the brains of smartphones and account for the largest portion of their cost.

The DX division’s spending on mobile AP solutions increased by 353 billion won, or 3.1 percent, year-on-year in 2023, following a significant increase from 7.63 trillion won in 2021 and 11.38 trillion won in 2022.

“The price of mobile AP solutions, a key raw material in the DX division, increased by about 30 percent compared to the previous year,” Samsung explained in its disclosure.

The increase in AP procurement costs is attributed to the rising prices of Qualcomm Inc.‘s mobile AP Snapdragon, which Samsung Electronics has primarily used in its Galaxy smartphones, along with MediaTek Inc.’s APs.

Samsung Electronics used its own AP, Exynos, in its Galaxy S22 series released in 2022, but as controversies arose due to game optimization service (GOS) performance and overheating issues, it fully adopted Qualcomm’s Snapdragon in the S23 series in 2023, leading to the increase in the cost.

The company plans to significantly expand the adoption of Exynos from 2024 onwards and aims to enhance its competitiveness in APs as well as effectively control procurement costs by increasing the use of its own APs.

It adopted Exynos 2400 alongside Qualcomm‘s Snapdragon in the Galaxy S24 series, marking the return of Exynos to the S series after a two-year hiatus, and there is also a growing trend to increase the use of Exynos in its mid-to-low-end lineup, which used MediaTek APs in 2023. The Galaxy A25 is equipped with Exynos 1280, and the Galaxy A35 and A55, which are due to be released in Korea in the first half of 2024, will be equipped with Exynos 1380 and Exynos 1480 respectively.

By Jeong Ho-jun and Yoon Yeon-hae

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]