Samsung signs $200 billion AI memory chip deal with Broadcom
Samsung Electronics has signed a memorandum of understanding (MOU) that worth more than $200 billion with with U.S. chip designer Broadcom. Broadcom is an American semiconductor and infrastructure software company that designs and supplies a broad range of chips and customize AI accelerator chips (ASICs) for major tech companies building their own AI hardware.
The $200 billion agreement between Samsung and Broadcom covers memory chips, contract chip making, and advanced packaging, and it will run through to 2030. Han Jin-man, president and head of Samsung Electronics' foundry business division, and Broadcom CEO Hock Tan led the announcement, with Korean government representatives presence at the "AI Summit" event held on July 24 at The Midway in San Francisco.
The MoU mandates Samsung to supply High Bandwidth Memory (HBM) to power Broadcom's next-generation AI accelerators. Samsung will also manufacture Broadcom's products, including wireless broadband communications solutions, on its 2nm and below process nodes. The phone maker will also provide advanced packaging technology on the 2nm process as a full package, linking design, process optimization, packaging, and mass production into one pipeline.
This is meant to shorten Broadcom's development timelines in the sense that it AI accelerators and communications silicon will be supported as Samsung pushes to capitalize on AI demand. Samsung is the world's only fully integrated device manufacturer (IDM) able to handle memory, foundry, and packaging independently. So, this deal leans hard into that "turnkey" advantage for Broadcom as it no longer has to juggle separate vendors for memory, chip fabrication, and packaging.
That means faster development cycles, tighter coordination between memory and logic components, and fewer bottlenecks that typically come from stitching together multiple suppliers. For Broadcom, it's a shortcut to scale. For Samsung, it's proof that its one-stop-shop model can win business that would otherwise go to rivals who specialize in just one piece of the puzzle. It's also a credibility win for Samsung because its chip division has struggled to command premium valuations due to investors' doubts. Investors doubted the chip division could compete with TSMC at the leading edge, and a $200 billion customer commitment is a strong counterargument.
This Samsung-Broadcom's $200 deal isn't just happening in isolation, it's part of a roughly $950 billion package of semiconductor/AI infrastructure cooperation between South Korea and the US, which also includes SK Hynix committing $750 billion to memory partnerships (including $500 billion with Nvidia). Samsung and SK Hynix, the world's two largest memory makers, are now both locked into massive long-term AI supply deals, and this has reinforced Korea's position as the backbone of the AI chip supply chain.
