Samsung could follow Micron by outsourcing DDR5 and SSD production to third parties to focus on more lucrative HBM and enterprise products — could SanDisk follow suit?

Samsung is reallocating its DDR5 and SSD production to external manufacturers as the company requires internal factory space for advanced HBM production. The company has shifted all additional conventional memory module production to outsourced partners, reserving its in-house capacity for the more advanced HBM packaging process.

This decision reflects Samsung's mounting need to use scarce back-end capacity more efficiently. Samsung has asked its semiconductor assembly and test partners to expand capacity for DDR5 modules and SSDs, even accelerating existing plans for capacity expansions. Several partners, including Dreamtech, Hanyang Digitech, and SFA Semicon, are already scaling up production.

Dreamtech recently began mass producing DDR5 modules in India, while Hanyang Digitech has invested in automating its Vietnamese memory module plant. SFA Semicon is relocating DDR5 testing and assembly equipment to the Philippines. The broader manufacturing shift is driven by Samsung's capacity constraints, partly due to a new HBM plant under construction at its Onyang campus, which will take multiple years to complete.

A separate $1.5 billion back-end processing plant is also being built in northern Vietnam. This situation mirrors a similar strategy pursued by Micron, which previously shifted conventional memory production externally while focusing internal resources on higher-margin products.