Samsung Electronics is making major changes to its troubled System LSI division to leverage AI technology, especially in image sensors, aiming to break Sony's decade-long monopoly on iPhone camera chips and reverse mounting losses.

Samsung Electronics is making major changes to its troubled System LSI division to leverage AI technology, especially in image sensors, aiming to break Sony's decade-long monopoly on iPhone camera chips and reverse mounting losses.

The South Korean tech giant has set up a dedicated sensor business unit, transferring more than 200 employees from its foundry business, according to people familiar with the matter. The reorganization comes as Samsung develops a new three-layer stacked sensor technology aimed at Apple's iPhone 18, expected to be launched in 2026.

The strategic focus includes transferring up to 150 professionals from automotive semiconductor projects to AI chip development, the sources said. Samsung will also establish an AI research center to enhance its capabilities in high-performance computing and chip design.

Industry analysts predict that the mobile image sensor market will grow more than 10 times to 43 trillion won ($24.3 billion) by 2029, from 3.57 trillion won in 2024. Sony currently holds 45% of the market, while Samsung has 19%.

The reorganization reflects a broader change in Samsung's semiconductor strategy amid increasing use of artificial intelligence. IDC predicts that by 2028, AI-enabled smartphones will account for 54% of total shipments, up from 16% in 2023.

Samsung reported that AI smartphone components accounted for about 20 of its core products in the second quarter of 2024, double the previous year. The company expects this number to increase further in 2025 as its system-on-chip and display driver IC product lines expand.

Industry experts say the PD-TR-Logic three-layer stacked sensor developed for Apple will significantly shorten the distance pixel values are transmitted. The improvement could give Samsung an edge in its battle for exclusive supply rights to Apple's flagship devices and potentially break Sony's long-standing position as the sole supplier of image sensors for iPhones.

Samsung's System LSI division expects these strategic shifts to bear more tangible fruit by the first half of 2025 as global demand for AI-powered devices grows. The division's investments in AI technology and sensor development represent a calculated bet on the growing importance of AI in mobile photography and computing.

The move to integrate sensor manufacturing operations into a new business unit, previously managed by the foundry division, shows Samsung's commitment to streamlining operations and improving competitiveness in the high-stakes image sensor market. As smartphone makers increasingly incorporate AI features into their devices, Samsung's strategic repositioning could help it capture a larger share of this expanding market.

Will the iPhone use Samsung camera sensors?

A few years ago, Apple began using Sony camera sensors in its iPhones. But now India Today cites recent rumors that these collaborations could be replaced by Samsung in 2026.

For a long time, Apple has been using Sony's camera sensors. But recent rumors suggest that this may soon change.

As early as last year, Ming-Chi Kuo, an analyst specializing in Apple, said that with the iPhone 18 (scheduled to be released in 2026), Sony's camera sensor design may change.

Now there is another leak, which India Today believes may confirm this speculation. According to the latest news, Samsung is developing a three-layer camera sensor for Apple, which will improve the camera performance of the latest iPhone.

As the author of this leak, India Today points out that a person named @Jukanlosreve announced on X (formerly Twitter) that Samsung will replace Sony's camera sensors. He revealed that Samsung is currently developing a three-layer image sensor for Apple.

According to these reports, Samsung plans to adopt a three-layer processor configuration, located opposite the sensor. As for the PD-TR-Logic configuration, it refers to the following layers: photodiode layer (PD), transport layer (TR), and logic layer.

The photodiode layer initially captures light, while the transport layer is responsible for reducing noise. This aspect is a new feature for Samsung's sensors. As for the logic layer, it will be responsible for the computational photography of the iPhone.

Kuo Ming-Chi also holds a similar view, saying that Samsung is expected to produce at least one sensor for the iPhone 18 in 2026.

India Today quoted Apple analyst Kuo Ming-Chi as saying: "Samsung is expected to start supplying Apple iPhone with 1/2.6-inch 48MP ultra-wide-angle CMOS image sensors (CIS) as early as 2026, breaking Sony's monopoly on Apple's CIS supply for many years. To this end, Samsung has set up a dedicated team to serve Apple."

What are the rumors about the new iPhone 18?

Recent rumors have suggested that Apple is planning to launch a borderless display for at least one model in the iPhone 18 series.

Such a move would mean the entire front of the phone would have a smooth, continuous display with no visible bezels or edges. Apple introduced the iPhone X in 2017, taking the first step towards bezel-less phones. However, progress has not been very significant since then. Instead, progress has been slow. Admittedly, the size of the bezel has been minimized, but we haven't succeeded in removing it completely.

However, other rumors suggest that the iPhone 18 series will be the first to enter the foldable phone arena.

The iPhone 18 is expected to debut in 2026, but that date has not yet been officially confirmed.

Source: Content compiled from digitimes

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