With Apple taking their business elsewhere Samsung is expecting to face shortfalls in its revenue if it doesn’t find new buyers for its products. Apple are already looking to TSMC for future production, as well as generating their own production, and this means Samsung will lose one of its biggest customers. Korea Times reports that Samsung has already eyed Sony, Amazon and Nvidia as three potential new customers.
Samsung will more or less sever all ties with Apple by 2014, a decision made by Apple not Samsung, and this is a big blow as Apple revenues accounted for 89% of Samsung foundry revenue – that is $38.5 billion. Additionally of Samsung’s annual revenue Apple contributed 16%.
Samsung is looking to produce for Amazon’s Kindle but apparently negotiations and progress are slow as Amazon are currently working with Texas Instruments but are eyeing up their own production as opposed to sub-contracting to an OEM like Samsung. Sony could also be a potential be a customer as their PS Series of handsets use ARM chips and they cannot produce their own as they do not have a foundry. Finally Nvidia is the last option and although Nvidia typically work closely with TSMC, with Apple joining TSMC we could see their capacity strained and Apple will be prioritised as their business is worth more than Nvidia. As a result Samsung could cash in on this and steal Nvidia from TSMC.
Apparently Samsung is now entering a new phase of operation where it will seek to produce processors for those companies with designs but no manufacturing plants to produce them in. Samsung is also moving away from its memory business which is less profitable in favour of producing processing chips for third parties and its own devices.
Image courtesy of Samsung
