The Samsung Galaxy S25 series, set to unveil at the upcoming ‘Galaxy Unpacked’ event on January 22nd, is poised to feature three models: the Galaxy S25, Galaxy S25+, and the Galaxy S25 Ultra. Market insiders suggest a potential price increase for the series, primarily due to the adoption of the Qualcomm Snapdragon 8 Elite chipset across all variants. This shift from the Exynos 2500 is attributed to its lower production yields.
Cost Implications of the Qualcomm Transition
The Galaxy S25 series is likely to incorporate the Snapdragon 8 Elite AP, which Qualcomm prices at approximately $190 (around Rs 16,300). This price point reflects the chipset’s advanced architecture, superior processing capabilities, AI enhancements, and other technological advancements. The Snapdragon 8 Elite is notably the first AP to be manufactured using TSMC’s 3nm process technology, which could also contribute to potential cost increases due to TSMC’s pricing strategies.
Production Challenges and Strategic Shifts
Traditionally, Samsung has employed Qualcomm’s chipsets in flagship models for certain markets such as the US, Canada, and China, while other regions like India have seen the use of Exynos SoCs. However, Samsung Foundry’s struggles with achieving sufficient yields on its 3nm chips have forced a change in strategy. Achieving only 20-30% yields against the necessary 70% for mass production implies a significant increase in costs due to the use of additional silicon wafers needed to meet production targets.
Consequently, Samsung has decided against using the Exynos 2500 for its 2025 flagship models, opting instead for Qualcomm’s solutions across the board. This decision mirrors past challenges where Samsung had to shift production from its 4nm node to TSMC due to similar yield issues with the Snapdragon 8 Gen 1, which was subsequently upgraded to the Snapdragon 8+ Gen 1.
As of the third quarter of 2024, TSMC dominates the contract foundry market with a 64% share, significantly outpacing Samsung Foundry’s 12% share.
