Samsung to Produce Next-Gen A12 Chips for iPhone 9

In 2018, Samsung Electronics will return to its position as the sole supplier of Apple’s next-generation A12 Systems on a Chip (SoCs), according to a report published Tuesday by The Korea Herald, which goes on to cite a “crucial deal” that was reached last month when Samsung’s co-CEO, Kwon Oh-hyun, met with Apple executives during a visit to Cupertino. The report alleges that Samsung was able to court the iPhone-maker due to the company’s decision to invest heavily in next-generation equipment that will exclusively be capable of manufacturing SoCs based on an ultra-powerful, yet remarkably power-efficient new 7-nanometer chip fabrication process.

“According to news reports on July 18, Samsung recently purchased extreme ultra violet lithography machines, the most advanced chip manufacturing equipment, to produce seven-nanometer mobile processors solely for iPhone,” industry sources cited in The Korea Herald report said.

Samsung Display Co., the display-manufacturing sub-division of Samsung Electronics, is already expected to provide Apple with as many as 160 million OLED display panels for its upcoming iPhone 8 flagship, and sources noted that this exclusive relationship was integral in leveraging the SoC deal between the two tech-giants. “[Samsung’s] CEO could persuade Apple’s top brass taking advantage of their close ties on OLED,” sources said, noting that Samsung is currently the world’s largest supplier of OLED displays, with a whopping 95% market share.

Back in 2015, Apple tapped both Samsung and Taiwan Semiconductor Manufacturing Co. (TSMC) to jointly supply it with A9 chips for the iPhone 6s and 6s Plus, however the move backfired tremendously when it was discovered that TSMC’s batch of A9 SoCs outperformed Samsung’s in a number of key battery tests. This blowback ultimately led Apple to tap TSMC as the exclusive supplier for both the A10 Fusion SoCs found in the iPhone 7 and 7 Plus, as well as the upcoming A11 SoC destined for this year’s iPhone 7s, 7s Plus, and high-end iPhone 8. The iPhone-maker’s move to TSMC as a sole supplier was also driven in part by the Taiwanese chip-maker’s aggressive moves to adopt manufacturing processes that would enable it to produce smaller and more energy-efficient 10 nm chips like A10 and A11.

Meanwhile, Samsung is said to be in the preliminary stages of testing its powerful new chip-making equipment, with looming plans to “seek final approval from Apple for the chip production” within the coming months. Currently, Apple’s entire line of iPhone 9 flagships — likely to debut in the fall of 2018 — are expected to feature OLED display panels, which will more than likely be manufactured by Samsung as well, and could measure as large as 6.46-inches on the high-end iPhone 9 Plus.