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Samsung Electronics will produce digital image sensors for Apple in the latest sign that South Korean technology companies are starting to reap the benefits of a series of US investments and President Donald Trump’s aggressive tariff policies.
The iPhone maker on Wednesday said it would work with Samsung’s semiconductor facility in Austin, Texas, “to launch an innovative new technology for making chips, which has never been used before anywhere in the world”.
Although the companies did not specify the technology to be deployed, people familiar with the deal said the South Korean chipmaker would make a three-layer stacked image sensor — used in smartphone cameras to capture images — for Apple’s iPhone 18, expected to be released next year.
“By bringing this technology to the US first, this facility will supply chips that optimize power and performance of Apple products, including iPhone devices shipped all over the world,” Apple said in a statement.
The deal is part of a plan announced at the White House by chief executive Tim Cook to raise Apple’s US investments by $100bn. It was revealed on the same day Trump vowed to impose a 100 per cent tariff on chips to the US. However, he added that companies such as Apple that invested in the US could avoid the new levies.
Samsung and South Korean rival SK Hynix are investing billions of dollars in advanced manufacturing facilities in the US. South Korea’s trade minister Yeo Han-koo on Thursday said the two memory-chip makers would not be subject to tariffs of 100 per cent, and that South Korean chips “would not get unfair treatment relative to other countries” as a part of a trade deal agreed between Seoul and Washington last week.
Lee Jong-hwan, a professor of semiconductor engineering at Sangmyung University in Seoul, said: “Samsung seems to have won this deal from Apple because of the imminent tariffs on foreign chips.”
He noted the deal meant Sony, whose image sensors are produced under contract by Taiwan Semiconductor Manufacturing Company in Kumamoto, Japan, would no longer be Apple’s sole supplier of the technology.
“Apple will have preferred Samsung over Sony because Sony doesn’t have US plants,” said Lee. “Sony and other Japanese chipmakers will begin to suffer a setback once tariffs are imposed. Samsung’s strategy to expand US capacity is paying off.” Sony declined to comment.
Samsung’s deal with Apple also marks a reconciliation between the two tech groups following an acrimonious split in the 2010s over patent disputes.
Apple dropped Samsung as its main contract chipmaking partner in favour of TSMC, a decision widely regarded as a catalyst for Samsung’s declining chip fortunes over the past decade.
But analysts said the image sensor deal represented the latest sign of a comeback, following a $16.5bn deal announced last week for Samsung to produce artificial intelligence chips for Tesla at its fabrication plant in Taylor City, Texas.
“It is not a big-size deal, but it is still meaningful that Samsung became another supplier for Apple in addition to Sony, which was a sole supplier for Apple’s image sensors,” said Pak Yuak, an analyst at Kiwoom Securities. “This deal will boost Samsung’s US plant operating ratio and help reduce its foundry losses.”
With additional reporting by David Keohane
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