South Korean chipmaker Samsung is looking to push its proprietary Exynos mobile processors onto rival OEMs, including Chinese manufacturer ZTE. A more recent report has revealed that the embattled ZTE is among the number of companies talking to the Korean giant; which could lead to some interesting negotiations. In early 2018, the United States government banned American companies from selling components to China's ZTE for seven years after it was found out that ZTE had been illegally shipping goods made with USA parts to Iran and North Korea. It also looks like the deal will likely go through even if ZTE's ban is overthrown, as the company would like to maintain a diverse source of vendors, so that they don't get stranded as in the current situation.
ZTE now represents a hard situation for many non-US companies looking to do business. Especially ones that come from a long time American ally like South Korea. It looks as though Samsung is attempting to capitalise on ZTE's struggles with the USA government, which now prevents the smartphone maker from using Qualcomm's chips. Samsung generates most of its profits from its memory chips, and the report notes that it has been ramping up development of logic chips such as mobile processors, image sensors and automotive chips in a diversification attempt. Notably, the company's System LSI business increased its shipments by 27 percent, Counterpoint stated. He stated that the company is in discussion with "multiple automobile companies" to develop chips for autonomous driving, but did not name the vehicle makers.
Currently Samsung, which is the world's smartphone manufacturer, is also the world largest semiconductor based microprocessor chipset manufacturer in the world.
System LSI still uses Samsung's foundry for all of its manufacturing needs, but is in talks with other contract manufacturers to diversify production in areas Samsung's foundry isn't prepared for yet, such as high-voltage automotive products, Kang said.
Samsung's semiconductor business, reporting a 2017 operating profit of 35.2 trillion won ($33 billion), contributed more than 65 percent of the whole firm's record annual profit of 53.65 trillion won a year ago. He declined to provide last year's growth rate.