LX Semicon, a fabless company that used to be part of the LX Group, a conglomerate of the LG Group, is now considering entrusting the production of next-generation display driver integrated circuits (DDIs) to Samsung Electronics for foundry work.
Samsung’s partnership with LX is expected to have a positive impact on the Korean semiconductor ecosystem and diversify the supply chain.
According to industry sources on July 2, LX Semicon has selected Samsung Electronics as its foundry partner to jointly develop and mass produce next-generation chips.
As one of Korea’s leading fabless companies, LX Semicon produces DDIs that control the pixels of smartphones and TV displays, and its major customers include LG Display and Chinese companies such as BOE and CSOT.
Image source Pexels
The company has recently been expanding its business to include power semiconductors for display devices and microcontroller units (MCUs) for automobiles, while increasing its share of high-unit-price organic light-emitting diode (OLED) panel products.
Similar to other Fabless companies, LX Semicon is only responsible for developing chips, with production work entrusted to foundries and annual expenses of more than 1 trillion won (currently about RMB 5.5 billion).
So far, LX Semicon has mainly outsourced the production of high-end products to TSMC, while mid- and low-end products are handled by SK Hynix System IC; and due to its association with LG Group, LX Semicon has not previously cooperated with Samsung Electronics’ foundry division.
Earlier this year, LX Semicon began talks with Samsung. Earlier this year, Samsung Display and LX Semicon decided to jointly research and develop DDIs for next-generation OLED panels for smartphones.
In addition to DDIs, it is expected that LX Semicon and Samsung Electronics’ foundry division will continue to collaborate on various next-generation chip developments. This is seen as a major move to strengthen the local semiconductor ecosystem. It creates a virtuous cycle where next-generation display chips developed by Korean fabless companies are mass-produced through Korean foundries and supplied to Korean display companies.
