Samsung Electronics to produce Qualcomm's Snapdragon 820 chips

Seoul: Samsung Electronics Co Ltd said on Thursday it will mass produce Qualcomm Inc`s new Snapdragon 820 mobile processors, in a major boost for the South Korean tech giant`s contract manufacturing business.

Samsung said the chips used its 14-nanometre manufacturing process which it also used to make its own Exynos processors. They would be in products in the first half of the year, Samsung added in a statement, without revealing the value of the contract.

The world`s top maker of memory chips has been trying to grow its processor business to diversify its revenue stream. It is growing more reliant on components as rivals such as Apple Inc and Huawei Technologies Co Ltd eat into its share of the smartphone market and pressure margins.

Samsung said the 14-nanometre technology cut power consumption by 15 percent and increased processing speed by up to 15 percent.

The firm added Nvidia Corp as a foundry client last year, while South Korea`s Electronic Times has reported that Samsung would start making chips for Advanced Micro Devices Inc this year as well.

The Electronic Times also reported last year that Samsung would use the Snapdragon 820 chips for some of its new flagship Galaxy S7 smartphones that will launch this year.