Samsung: The Only Alternative, and Eleven Times SmallerWide moat

TSMC (TSM) — moat facet

Samsung's real function is not to win TSMC's business but to exist — it is worth more to TSMC's customers as leverage than as a supplier.

Samsung Foundry is the only other company on earth that can currently manufacture a leading-edge logic chip in volume, and it holds about 6.5% of the pure-foundry market against TSMC's 73%1 — a gap of more than eleven to one. In the June quarter its share slipped again, to 5.9%, as competitors grew faster2. Its structural handicap, that it competes with its own customers in phones, processors and memory, is examined on the Trusted Foundry page and is not repeated here.

Samsung Foundry share of foundry revenue (%)8.1%4Q247.3%2Q256.8%3Q257.1%4Q256.5%1Q265.9%2Q26TrendForce top-10 foundry rankings, 4Q24-2Q26
The only other leading-edge foundry lost more than two points of share in eighteen months, to 5.9%.

What is worth adding is that Samsung's real function in this market is not to win business. It is to exist. A fabless company negotiating with a supplier that has 90%-plus of advanced-node capacity has almost no leverage, and the only thing restraining TSMC's pricing is the theoretical possibility of going elsewhere. Samsung provides that possibility, and is therefore worth more to TSMC's customers as a bargaining position than as a manufacturing partner.

It is not a hollow threat. Samsung is prioritising yield on its SF2 2nm process, and Qualcomm and Tesla among others have planned to use it3 — customers who value a second source enough to accept a technology compromise. Samsung has also historically won business precisely when TSMC's capacity was tightest.

Watch Samsung's SF2 yields rather than its share. Share moves years after yields do, because designs commit long before they ship. A Samsung that reaches parity on yield would not take much of TSMC's business, but it would change what TSMC can charge — and given that TSMC has told customers to expect four consecutive years of price increases4, the pricing is where this rivalry actually lives.

Moat trajectory: Widening

The gap has not closed. Samsung is working on SF2 yields and has named customers willing to try it, which is real, but TSMC's share rose again while that was happening. Widening from TSMC's side — with the standing caveat that a second source matters to customers as a price restraint long before it matters as a supplier, so Samsung's existence is worth more than its share.

The number that tests this moat
Third-party estimate
Samsung's foundry share against TSMC's
~6.5% vs ~73%

A gap of more than eleven to one, and it widened again in the most recent quarter. Samsung matters to TSMC's customers as a price restraint rather than as a supplier. Watch SF2 yields rather than share — share moves years after yields do, because designs commit long before they ship.

Source: Third-party foundry market-share data, Q1 2026 ↗
References
  1. Third-party estimateSamsung Foundry holds about 6.5% of the pure-foundry market against TSMC's ~73%.
    Third-party foundry market-share data, Q1 2026 — TSMC captured about 73% of the pure-foundry market; Samsung second at 6.5%, followed by SMIC 5.1%, UMC 3.9%, GlobalFoundries 3.3% and HuaHong 2.5%; Intel does not appear in the top ten foundry rankings; Intel 18A entered high-volume manufacturing in October 2025 with yields estimated at 65-75%, still below TSMC's mature 3nm process, and Intel Foundry reported a $2.4 billion operating loss in Q1 2026; SMIC posted a record quarter at 93.7% utilisation; Samsung is prioritising yield on its SF2 2nm process, with Qualcomm and Tesla among those planning to use it — Q1 2026 · publ. 2026 · source ↗
  2. Third-party estimateSamsung's foundry share slipped to 5.9% in 2Q26 as competitors grew faster.
    TrendForce, 2Q26 top-10 foundry ranking (TSMC revenue nearing US$40.2B, 72.5% share; Samsung Foundry US$3.26B, share down to 5.9%; SMIC above US$3B, 5.4%) — 2Q26 · publ. September 9, 2026 · source ↗
  3. Third-party estimateSamsung is prioritising SF2 2nm yields, with Qualcomm and Tesla among those planning to use the process.
    Third-party foundry market-share data, Q1 2026 — TSMC captured about 73% of the pure-foundry market; Samsung second at 6.5%, followed by SMIC 5.1%, UMC 3.9%, GlobalFoundries 3.3% and HuaHong 2.5%; Intel does not appear in the top ten foundry rankings; Intel 18A entered high-volume manufacturing in October 2025 with yields estimated at 65-75%, still below TSMC's mature 3nm process, and Intel Foundry reported a $2.4 billion operating loss in Q1 2026; SMIC posted a record quarter at 93.7% utilisation; Samsung is prioritising yield on its SF2 2nm process, with Qualcomm and Tesla among those planning to use it — Q1 2026 · publ. 2026 · source ↗
  4. Third-party estimateTSMC has notified advanced-process customers to expect price increases in each of four consecutive years from 2026.
    TrendForce and related reporting on TSMC advanced-node pricing — 2nm wafers priced at roughly $30,000, a 10-20% premium over 3nm; advanced nodes below 5nm to rise a further 5-10% in 2026; customers of advanced processes notified to expect price increases in each of four consecutive years beginning 2026 — 2026-2029 · publ. October 2025 · source ↗
Sources
Generated September 23, 2026