Samsung’s Partnership with Nintendo on Switch 2 SoC Signifies a Notable Setback for TSMC; AMD and Sony Exploring Collaboration as Well

Nintendo’s recent collaboration with Samsung Foundry to create the System on Chip (SoC) for the upcoming Switch 2 marks a significant shift in the semiconductor landscape. Following this strategic move, there has been a notable surge of interest from other major players in the tech industry seeking partnerships with Samsung.

AMD and Sony Eye Potential Chip Development Opportunities with Samsung Following Nintendo’s Partnership

For those unfamiliar with the details, the Nintendo Switch 2 will feature a chip designed exclusively by NVIDIA. However, the most noteworthy aspect of this partnership is Nintendo’s choice to go with Samsung instead of its traditional supplier, TSMC. The primary motivation behind this decision lies in Nintendo’s utilization of Samsung’s advanced 8nm fabrication process, an area where Samsung has demonstrated clear expertise. According to a DigiTimes report, this agreement represents a crucial opportunity for Samsung Foundry to penetrate new markets, with both AMD and Sony expressing interest in collaboration with the Korean company.

This aligns with earlier discussions regarding Sony and AMD’s initiative to create a bespoke low-power SoC for a new “portable”gaming device, tentatively dubbed Project “Jupiter.”Reports suggest that this device is likely to leverage Samsung’s cutting-edge 2nm process. This new development reinforces earlier analyses and confirms that Samsung Foundry is attracting potential clients from beyond its established partnerships, marking a rare victory over TSMC regarding process adoption.

Samsung's 3nm GAA process and its ambitious targets

While TSMC has long been recognized for its advanced manufacturing capabilities, Samsung’s greater production capacity—partially attributed to its lack of commitments to NVIDIA—positions it as a formidable competitor in the market. Nintendo’s decision to partner with Samsung Foundry is also fueled by the anticipated success of the Switch 2, which is projected to sell over 20 million units, potentially generating upwards of $1 billion in revenue for Samsung. Although these figures pale in comparison to TSMC’s output, Samsung Foundry is focused on restoring its reputation within the semiconductor industry.

Moreover, Samsung’s rapid advancements with its 2nm process are yielding impressive results that could rival TSMC’s offerings. This development may lead to securing additional orders from NVIDIA, AMD, and Sony. Though we have reasons to be cautiously optimistic about Samsung Foundry’s prospects, it’s important to temper expectations; historically, the company has faced challenges in meeting high industry standards.

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