A few days ago, executives representing Samsung's financial division, i.e., Samsung Securities, suggested that the tech conglomerate could spin off the Foundry and System LSI divisions and list them on the US stock market. The chief of Samsung Electronics has now responded, saying that the spin-offs are not in the cards.

Market watchers expect Samsung's Foundry and System LSI divisions to post significant operating losses this quarter again. The Foundry arm, especially, has been underperforming way below expectations.

Chip manufacturing difficulties continue, and major clients like Apple and Nvidia signed big contracts with Taiwanese chipmaker and Samsung Foundry rival TSMC. The latter maintains a market share gap of over 50% between it and Samsung's Foundry division.

For these reasons, Samsung Securities suggested not long ago that the Foundry and System LSI divisions should spin off into new businesses. Doing so would have prevented the underperforming arms from dragging down the bottom line of the Samsung Electronics group.

However, according to a new Reuters report, chairperson Jay Y. Lee disagrees with this notion and has no such plans for the Foundry or LSI divisions.

Lee still believes in the long-term plan

Rebutting the previous reports about a possible spin-off, Jay Y. Lee recently told the media, “We are hungry to grow the business. Not interested in spinning off.”

Although Jay Y. Lee admitted difficulties at the new chip factory in Texas due to a “Changing situation (and the US presidential) election,” the chief of Samsung says he is committed to the original long-term plan.

More details after the video

In 2019, Lee laid down his plan to grow the Foundry business with the goal of overtaking TSMC as the world's largest chip manufacturer before the year 2030.

So far, Samsung invested billions of dollars into developing its chip manufacturing infrastructure, with new plants popping up in both South Korea and the USA.

Unfortunately, lately, Samsung Foundry has been struggling to keep up with TSMC on newer manufacturing nodes, and the company has been unable to secure key clients. Recently, Samsung Foundry pushed back its chip production schedule for the Texas plant from late 2024 to 2026.

Furthermore, reports say the company is struggling with Exynos 2500 chip yields, which might put the upcoming Galaxy S25 series in an awkward situation.

Nevertheless, it looks like the head of Samsung is keeping an eye on the long-term goal, even if it means posting operational losses for the time being.

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