Samsung in talks to sell Exynos chips to ZTE following USA ban

Ruben Fields
May 17, 2018

The semiconductor business is a driving force of Samsungs profits, but its Exynos mobile chipsets are rarely seen in other manufacturers devices, with the only external client being Meizu with the latest 15 Plus phone.

CHIPMAKER Samsung is reportedly in talks with several of its rival OEMs, including beleaguered ZTE, to supply them with its Exynos mobile processor chips in a bid to take on Qualcomm.

The South Korean tech giant generates the bulk of its profit from its basic memory chips and has been beefing up development of logic chips such as mobile processors, image sensors and automotive chips to diversify. The company later clarified the statement in relation to ZTE, which is now facing a seven year ban from America for violating sanctions on Iran and North Korea.

ZTE now represents a hard situation for many non-US companies looking to do business.

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Its efforts like that will put further pressure on the industry leader Qualcomm, which said last month it expects the loss of business with ZTE to lower its profits by 3 cents per share next quarter. Basically, this means that ZTE won't be able to use Qualcomm's chips inside its smartphones, so the Chinese company is looking for another supplier. The clarification claims that there is no certainty that a deal can be reached with ZTE, and that the company treats all vendors equally. Notably, the company's System LSI business increased its shipments by 27 percent, Counterpoint stated. In January, the company announced that it is providing Audi with Exynos chips.

In an interview, Inyup Kang, the head of Samsung's System LSI division, said the company is "talking to all OEMs" about the supply of chips.

Currently Samsung, which is the world's smartphone manufacturer, is also the world largest semiconductor based microprocessor chipset manufacturer in the world. Samsung's semiconductor business reported a 2017 operating profit of $33 billion, and it contributed more than 65 percent of the whole firm's record annual profit of 53.65 trillion won past year.

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