Samsung Electronics 2Q26 Earnings Call Q&A Q. What is the current foundry utilization rate? A. Utilization rates have improved across all process nodes. At advanced nodes of 8nm and below, we have maximized sales on strong demand from high-growth applications, and utilization has reached peak levels. Regarding yields, based on our mass-production experience with the first-generation 2nm process, we will begin the full-scale ramp-up of our second-generation 2nm process in the second half of the year. We continue to stabilize yields and improve productivity through process optimization. In terms of profitability, the combined effects of higher utilization, improved yields, and price increases have driven a significant year-over-year improvement, and the recovery is now gaining momentum. As for the timing of a return to profitability, the order-based nature of the foundry business makes it difficult to provide a precise timeframe. However, we expect to achieve a turnaround in the near future. Q. What are Samsung’s foundry capacity-expansion plans? A. The pace of advanced-node capacity expansion has not been sufficient to keep up with demand. To address this, preparations for the Taylor Fab 1 to commence operations in 2026 are progressing as planned. We intend to expand our 2nm capacity in phases. To respond to growing customer demand in a timely manner, we are also preparing to begin construction of Taylor Fab 2 by the end of this year, targeting mass production in 2030. In addition, as customer inquiries regarding the 1.4nm process increase, we are reviewing the possibility of securing an additional fab. Detailed plans will be developed in phases based on customer orders and the outcome of ongoing discussions. For mature nodes, we are shifting toward a higher-margin business mix and concentrating our capabilities on demand for high-value-added specialty products. Specifically, we are expanding capacity for 8nm, 17nm, CIS, and embedded nonvolatile memory, or eNVM, where demand is increasing. We are also focusing on areas such as integrated silicon capacitors and silicon photonics.