AMD Taps Samsung as a Backup Chipmaker — But Can a Second Foundry Really Unlock Its AI Growth Ceiling?

Shares of AMD jumped 3.7% in pre-market to $526.00 after Nikkei Asia reported that Google, AMD, BYD, and Tesla intensified foundry cooperation with Samsung Electronics , a sign that the world's biggest chip buyers are no longer willing to wait in TSMC's queue. AMD is in talks to have Samsung produce some of its CPUs starting in 2028 , a move that could reshape how—and how fast—the company delivers AI hardware.

• TSMC's Shortage Is the Problem AMD Needs to Solve

At its June 4 shareholders meeting, TSMC CEO C.C. Wei warned that global chip supply will "lag behind" AI-driven demand "for years."

Advanced-node capacity is reportedly sold out through at least 2027, with demand running roughly 25–30% above capacity. For AMD, which just posted Data Center revenue of $5.8 billion, up 57% year-on-year , the bottleneck is existential: you can't sell chips you can't build. Concerns persist that TSMC's advanced-node capacity could limit future shipments.

• Samsung Offers Extra Factory Capacity, but With Strings Attached

AMD secured HBM4 memory supply from Samsung, but the deal reportedly includes a condition: Samsung may use memory shipments as leverage to secure a partial shift of AMD's advanced AI chip production to Samsung Foundry. In plain terms, Samsung is bundling memory and manufacturing into one package. Industry officials caution Samsung is likely to play a supplementary role because mass production stability and yield remain critical.

• A Second Supplier Could Protect AMD's Revenue Ramp CEO Lisa Su guided Q2 revenue to $11.2 billion and raised the company's long-term server CPU market growth forecast from 18% to 35% annually, projecting it would hit more than $120 billion by 2030. Hitting those targets requires wafer supply AMD cannot get from TSMC alone. With TSMC's advanced-node capacity choked through 2028, Samsung appears to be AMD's next best option for manufacturing next-generation processors in sufficient volumes.

• The Yield Gap Still Matters for Shareholders

Samsung still lags behind TSMC in yield rates —the share of chips that come off the production line working correctly. Lower yields mean higher per-chip costs, which could pressure AMD's gross margin, currently at 55% . Samsung's 2nm yields have reportedly reached 55–60% , promising but unproven at commercial scale. If Samsung delivers, AMD diversifies its supply chain and unlocks volume it literally cannot produce today. If it doesn't, AMD has paid in engineering time and margin for insurance it may never collect on.