Samsung's Mid-Range Phone May Soon Be Powered By Intel Chips

Though Intel has a relatively large footprint on the tech industry, it has had some trouble getting solid footing in the smartphone industry as a chip provider. For some reason, it has not been able to offer the same performance, power consumption and features as its competitors, such as Qualcomm. However, things might change as the company has plans to supply chips for Samsung's mid-range devices.

Intel's Part In Processor Manufacturing

Intel may not exactly be the manufacturer for the chips. Instead, the company will act as a contract manufacturer for other chip designers. As DigiTimes notes, one such deal that Intel currently has is with Spreadtrum Communications, which is a mobile processor maker. The publication claims that Intel is currently in the midst of releasing 14nm application processors for Spreadtrum.

Sample shipments will reportedly start rolling out in October. Furthermore, both companies have set their eyes on Samsung Electronics and its mid-range line of mobile units. To be more specific, Spreadtrum plans to settle orders from Samsung, with the processors produced by Intel, starting 2017.

The Profitability Of Samsung's Mid-Range Smartphones

As The Motley Fool notes, being in charge of supplying the processors in Samsung's mid-range handphones is definitely not as impressive as landing a deal for its Galaxy S and Galaxy Note series. However, a large part of Samsung's profits come from the sale of its mid-range units. As such, demand for its chips is definitely at a high as well.

What This Could Mean For Intel

Intel's future is, in fact, looking bright. If Spreadtrum scores the deal with Samsung, it could mean great profits for Intel. To illustrate, Taiwan Semiconductor Manufacturing Company (TSMC), which is also a contract chip manufacturer, receives an average gross profit margin of 50 percent by providing chips to third party suppliers. Furthermore, Intel has already won in the battle to power Apple's latest iPhone 7.

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