[News] Samsung Reportedly Poised for Major Overhaul of Advanced Packaging Supply Chain amid HBM Race

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Has the elephant started dancing? In addition to the reshuffle of its semiconductor executive team in November, Samsung is reportedly set to significantly revamp its supply chain for advanced semiconductor packaging, as per a report from South Korean media outlet ETNews.

Notably, the move is expected to include the reevaluation of its materials, components, and equipment (MCE) suppliers from the ground up, which will likely to impact both the development and procurement processes, the report indicates.

Samsung’s action is well-grounded, as advanced packaging plays a critical role in its next-gen semiconductors, such as High Bandwidth Memory (HBM), according to the report. HBM, which stacks DRAM chips and connect them with GPUs or AI accelerators for processing large-scale data, heavily depends on sophisticated packaging.

According to ZDNet, Samsung has started ordering equipment to produce 1c DRAM for a mass production line at its Pyeongtaek campus (P4). The company reportedly plans to use 1c DRAM in HBM4 Core chips, which is more advanced than the 1b DRAM used by its archrivals, Micron and SK hynix, for their HBM4 chips, as noted by the report.

A Two-pronged Approach: Thorough Review, Different Sourcing Strategy

Industry sources told ETNews on the 25^th that Samsung’s restructuring of its advanced packaging supply chain includes a thorough review of the existing system and the establishment of a new supply chain to enhance packaging competitiveness.

To start with, Samsung is reportedly focusing on equipment, prioritizing performance over existing partnerships. In some cases, the company has returned equipment previously purchased to align with its renewed evaluation standards, with the possibility of replacing or diversifying current supply chain members, as noted by the report.

On the other hand, Samsung is also changing how it sources semiconductor equipment, according to ETNews. The report notes that instead of its previous “Joint Development Program” (JDP) pattern, which partnered with one supplier for development and commercialization, Samsung now plans to adopt a “one-to-many” model, potentially starting as soon as 2025.

Implications for the Supply Chain Ecosystem

It is worth noting that the impact could be immense, as this overhaul is expected to affect both equipment suppliers and material supply chains. Moreover, the changes will likely be applied to both domestic and international partners, focusing on performance and innovation over location or past relationships, as suggested by the report.

If it works out fine in the advanced packaging sector, Samsung may apply similar reviews to front-end processes, the report notes.

Read more

• [News] Samsung Reportedly Unable to Supply HBM3E to NVIDIA in 2024 as Gap with SK hynix Widens
• [News] Samsung to Build 10nm 7th Gen DRAM Test Line Ahead of 6th Gen Mass Production

(Photo credit: Samsung)