Samsung Electronics and Qualcomm have hit a roadblock in their negotiations for a foundry contract to manufacture application processors on a 2-nanometer process, according to a report by The Bell. Pricing disagreements have stalled the potential deal, threatening to push production timelines past 2026 and complicating the firms’ strategic alignment.
Apple and Nvidia heavily utilize TSMC for advanced nodes, leaving competitors like Qualcomm to navigate a volatile manufacturing landscape. While Samsung’s SF2 gate-all-around (GAA) technology has reportedly cleared major performance and yield hurdles, commercial friction is keeping the two tech giants apart.
The Technical Readiness of Samsung’s SF2 Node
Technical performance is not the bottleneck in this delayed partnership. According to reporting from The Bell, Qualcomm responded positively to Samsung’s 2nm process evaluations. Furthermore, Samsung’s own Exynos 2600 and upcoming Exynos 2700 mobile processors—both built on the 2nm architecture—have yielded favorable benchmark evaluations in early testing.
Unlike TSMC, which is transitioning to GAA transistor architectures only with its 2nm generation, Samsung implemented GAA technology starting with its 3nm (SF3) node and is now iterating on its third generation of the technology. This architectural shift moves away from traditional FinFET designs, wrapping the channel entirely to suppress leakage currents and improve power efficiency at sub-3nm scales.
Despite these engineering milestones, commercial terms have derailed execution. Qualcomm is aggressively pushing for lower manufacturing costs per wafer, while Samsung is holding firm on pricing.
Shifting Foundry Strategies and the TSMC Factor
The disagreement exposes a fundamental evolution in Samsung Foundry’s business model. Historically, the division aggressively undercut competitors to secure high-volume application processor contracts. That aggressive discounting is no longer standard practice. Having locked in enterprise-tier strategic clients including Tesla and Broadcom, Samsung is demonstrating increased pricing power.
Compounding this friction is the scale of the current order. According to statements cited by The Bell from a Samsung Electronics official, the production volumes currently under discussion with Qualcomm are relatively modest. That limited volume reduces Samsung’s commercial incentive to offer deep pricing concessions.
Meanwhile, the broader market context highlights why Qualcomm is exploring alternatives to its primary supplier. As detailed in coverage following CES 2026 in Las Vegas, Qualcomm CEO Cristiano Amon previously acknowledged advanced discussions regarding the 2nm transition. Qualcomm previously severed ties with Samsung Foundry in 2022 due to thermal throttling and efficiency issues with the Snapdragon 8 Gen 1—which was manufactured on Samsung’s early nodes—before shifting flagship production entirely to TSMC.
Relying exclusively on TSMC introduces structural risks for fabless designers:
- Wafer Pricing: TSMC commands premium pricing for its advanced nodes, with costs per silicon wafer reaching historic highs.
- Capacity Contention: High-demand accelerators and smartphone chips from Apple and Nvidia saturate TSMC’s advanced lithography lines.
- Geopolitical Concentration: Geographic centralization of sub-3nm manufacturing in Taiwan presents continuous supply chain vulnerabilities.
Timeline Pressures and Next-Generation Pivots
Because negotiations have stalled, aligning chip fabrication schedules with smartphone launch calendars for 2026 is increasingly difficult. A Samsung official noted that the current delay makes 2026 production for Qualcomm’s processors unlikely.
Both companies are already evaluating whether to bypass the immediate hurdles and pivot discussions toward Qualcomm’s next-generation application processors. Whether Samsung’s newly built manufacturing capacity—such as its facility in Taylor, Texas, which offers domestic U.S. production alignment under the CHIPS Act—can bridge the gap remains a decisive factor for future negotiations.
