Samsung Electronics' semiconductor division is temporarily shutting down production lines at some of its foundry (contract manufacturing) facilities to cut costs. Previously, Samsung Electronics had halted over 30% of its 4nm, 5nm, and 7nm foundry lines at the Pyeongtaek Foundry Lines 2 and 3, and it plans to extend this shutdown to approximately 50% of the entire foundry facility by the end of the year.

Analysts estimate that Samsung's foundry business incurred a loss of up to 1 trillion won (around $726 million) in the third quarter, prompting the company to implement cost-cutting measures by suspending parts of its production lines, as reported by The Chosun.

This decision reflects Samsung's efforts to reduce operating costs within its foundry division as it grapples with increasingly limited large-scale orders from global tech companies such as Nvidia, AMD, and Qualcomm.

Instead of maintaining production lines at low capacity, sources report that Samsung has opted to cut off power to reduce expenses.

Orders from Chinese companies previously constituted a significant portion of Samsung's 4nm and 5nm production volume. However, U.S. trade restrictions on China’s semiconductor industry have led some Chinese manufacturers to delay projects.

Some experts are concerned that Samsung’s cost-cutting measures may weaken its competitiveness in the foundry sector.

Lee Jong-hwan, a professor of system semiconductor engineering at Sangmyung University, stated, "As Samsung Electronics focuses on memory chips, the backbone of its semiconductor business, the foundry business has been sidelined. With production facilities shutting down, the growing gap with TSMC will eventually make it challenging for Samsung to catch up.