Samsung Suffered $270 Million Loss Due To Power Outage In Texas
In February this year, Samsung had to temporarily shut down its chip plant in Austin, Texas following a statewide power outage. The company has now revealed that this shutdown caused damage of over 300 billion won (more than $270 million).
Heavy snowfall and cold waves in Texas on February 6 had caused power and water outages throughout the state. In view of the situation, Texas authorities ordered the shutting down of fabs. Samsung had to immediately stop production and shut down the Austin chip plant.
A wafer production was reportedly in progress when the power outage happened. As the outage disrupted the production, the company had to destroy those wafers. “About 71,000 wafers were affected, and this corresponds to around 300 to 400 billion won in damage,” said Han Seung-hoon, a senior vice president at Samsung’s foundry business.
Texas authorities had reportedly notified the firm of the power outage beforehand. “We did have time to prepare,” Han said. This allowed Samsung to restart operations earlier than expected. However, the company still had to stop the production of chips for over a month. According to Korean media, it was the first time in Samsung’s history that it had to halt chip production for a month.
The Korean firm sent engineers from its homeland as well as from partner firms to Austin to restart production. As of March 31st, the company had restarted 90 percent of the overall production capacity at the plant. The facility is now in full operation.
Along with Samsung, other companies operating chip plants in Texas, such as NXP Semiconductors and Infineon Semiconductors, also had to shut down their respective plants during the statewide power and water outages in February.
Texas power outage caused a multi-million dollar loss to Samsung
Samsung manufactures various semiconductor chips at its Austin plant. Also called Line S2, the company makes image sensors, radio frequency integrated circuits (RFIC), display driver integrated (DDI) circuits, solid state drive (SSD) controllers, and other microprocessors at the facility. It uses 14nm to 65nm process nodes to make these chips.
At a time when the tech industry is facing an unprecedented semiconductor chip shortage globally, a month-long shutdown of such an important chip production facility surely hurt Samsung big time. The $270 million monetary loss is huge, of course, but the incident may have worse repercussions in the long run.
Samsung is now working with Texas authorities to try and prevent such an incident from happening again. The company is also in talks with local utility companies to find a solution.