Samsung Eyes Cost Cuts, Boosts Exynos Use in Galaxy Phones Amid Chipset Shifts

As Samsung navigates through declining shipments and revenue from its Exynos chipsets, the electronics giant is strategically pivoting towards incorporating more Exynos chips in its Galaxy lineup, starting with the S24 series, to mitigate rising costs.

Samsung Shifts Strategy to Exynos Chipsets Amid Rising Costs and Declining Revenues

Chipsets are one of the most expensive inputs for Samsung's mobile division. If Qualcomm raises its prices, Samsung will have little choice but to pay what it demands. With prices expected to be significantly higher, it appears that Samsung intends to include Exynos chipsets in many Galaxy devices starting this year to save money.

A recent report by SamMobile, a source, revealed that Samsung has reduced the use of Exynos chips on Galaxy devices. Exynos-powered devices shipped in Q4 2023 totaled just 13 million, 48% less than in Q4 2022. Samsung's revenue from smartphone chipsets was also down 44% during the same period. Because Exynos chipsets are primarily used in Galaxy devices, this decline was caused mainly by Samsung purchasing more chipsets from Qualcomm for high-end devices and from MediaTek for some low-end phones.

Samsung Electronics' 2023 business report shows that the company's mobile division spent $8.87 billion on mobile chipsets in 2023. The division spent 3.1% more on these components last year than in 2022. According to the report, the price of mobile chipsets has "increased by about 30 percent compared to the previous year."

Samsung is reportedly planning to increase the use of Exynos chipsets in Galaxy devices starting in 2024. This will help reduce procurement costs. Samsung will also make investments to improve the competitiveness of its Exynos chipsets in response to user concerns about performance and power efficiency.

Samsung's Exynos Chipsets See Revival in Galaxy S24 Amid Declining Shipments and Revenue

In recent years, Samsung has reduced using Exynos chipsets on its phones and tablets. Take the Galaxy S23 series as an example. The lineup features only the Snapdragon 8 Gen 2 chipset. The brand also uses fewer Exynos SoCs in mid-range and low-end devices than it did a few years ago.

While it is clear that the use of Exynos chipsets is declining, fortunately, that is changing today. Canalys recently published a report on X analyzing the global smartphone market by processor vendor, which includes some disappointing news about Exynos chipsets and Samsung Semiconductor.

According to the report, Samsung Semiconductors shipped 13 million smartphones with chipsets in Q4 2023, 48% less than Q4 2022. As a result, the company's revenue from smartphone chipsets was USD 5 billion in the last quarter, 44% lower than in Q4 2022.

Unlike the Galaxy S23 series, Samsung has used the Exynos chipset in the Galaxy S24 lineup. As a result, the shipment of smartphones with Exynos chipsets is expected to increase in this and subsequent quarters, increasing Samsung Semiconductors' revenue significantly. It would be interesting to see the future figures.

Canalys also reports that MediaTek processors powered the most smartphones (117 million) in Q4 2023. Apple was the second-largest chipset provider, with its SoCs powering 78 million smartphones, while Qualcomm was the third-largest chipset supplier, with processors powering 69 million smartphones.

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