Samsung Electronics is in talks with shoppers about mountain climbing costs for chip contract manufacturing by as much as 20% this yr, Bloomberg reported on Friday.
The transfer, anticipated to be utilized from the second half of this yr, is a part of an industry-wide push to lift costs to cowl rising supplies and logistics prices, Bloomberg mentioned, citing individuals conversant in the matter.
Contract-based chip costs are prone to rise round 15% to 20%, relying upon the extent of sophistication, with chips produced on legacy nodes prone to face larger hikes, Bloomberg mentioned, including Samsung had accomplished negotiations with some shoppers whereas nonetheless in discussions with others.
Samsung Electronics declined to remark.
The brand of Samsung Electronics is seen at its workplace constructing in Seoul, South Korea, March 23, 2018. REUTERS/Kim Hong-Ji.
The corporate is the world’s second-largest chip contract producer, after Taiwan Semiconductor Manufacturing Co (TSMC).
TSMC has forecast an as much as 37% soar in current-quarter gross sales, saying it expects chip capability to stay very tight this yr amid a worldwide chip crunch that has stored order books full and allowed chipmakers to cost premium costs.
Samsung mentioned in an earnings name in late April that main prospects’ demand for its chip contract manufacturing was larger than its accessible capability, and it anticipated the availability scarcity to proceed.