An aerial view of Samsung Electronics' new foundry factory in Taylor, Texas. [Getty Images]
An aerial view of Samsung Electronics' new foundry factory in Taylor, Texas. [Getty Images]

Samsung Electronics has officially announced plans to expand its foundry factory in Taylor, Texas. Customer demand has surged — particularly for leading-edge processes — pushing production capacity to its limits, and the company says it will move quickly to scale up and meet demand in time.

As recently as the first half of last year, the Taylor site had struggled to attract orders, with its launch repeatedly delayed. A string of major customer wins has since pushed capacity to the breaking point, and Samsung is now moving to expand the facility — a complete reversal in just about a year.

Kang Seok-chae, executive vice president of Samsung Electronics' foundry business division, said Thursday during a conference call accompanying the company's second-quarter earnings release that Samsung is "preparing to begin construction on Taylor's second factory by year-end, targeting mass production in 2030, in order to respond in a timely manner to growing customer demand."

"The current pace of capacity expansion for leading-edge processes is not keeping up with demand," Kang said. "Taylor's first factory is proceeding as planned in its launch preparations, and we will gradually expand 2-nanometer capacity."

He added that Samsung is "shifting mature processes toward high-margin leading-edge processes and pursuing an operational strategy focused on high-value-added specialty demand where technological barriers are high."

The Taylor factory is Samsung Electronics' state-of-the-art foundry hub, built with $37 billion in investment starting in 2022 to win orders from North America's top fabless chipmakers — including Nvidia, Tesla, Apple, Qualcomm and AMD.

While the existing Austin factory serves as a production base centered on mature processes, the new Taylor facility is betting on cutting-edge 2nm technology.

After a gap in orders delayed its launch, Samsung secured a major turnaround in July last year when it won an order from Tesla for AI chips worth around 23 trillion won ($15.9 billion). Those Tesla AI chips are also set to be produced through Taylor's 2nm process.

With momentum building in securing additional customers, Samsung's foundry earnings are expected to improve more rapidly once the "Taylor era" gets fully underway.

Kang said Samsung has "secured 2nm project orders from major cloud service provider customers as well as AI and high-performance computing customers, and those customers have begun product design."

He added that Samsung is "continuing to expand new leading-edge process orders by discussing various projects with key customers, including Broadcom. Based on this order momentum, the number of 2nm order projects this year is expected to more than double compared to last year."

Samsung is also reportedly in talks with Anthropic, the developer of the generative AI model Claude, on AI chip collaboration based on its 2nm process. Samsung's foundry is currently mass-producing Nvidia's AI inference chip, the Groq 3 LPU, based on its 4nm process, and continued collaboration on next-generation products centered on leading-edge processes is expected.

The semiconductor industry views Samsung Electronics' expansion of Taylor's second factory as a move that will also, in part, align with the Donald Trump administration's push for domestic semiconductor production and its pressure on companies to invest in the United States.


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