Toshiba To Outsource LSI Chip Production To Samsung

Toshiba seems to be determined to completely overhaul its semiconductor segment. Yesterday, it was reported that Sony will buy back a semiconductor plant it sold to Toshiba two years ago for $600 million (the deal was confirmed today). And today, Toshiba itself said it is ready for a second step: the company is in talks with Samsung to farm out the production of LSI chips to its Korean rival.

Toshiba will continue to design chips but outsource production to Samsung. The Japanese company will, however, not stop producing system chips it currently ships to customers.

Toshiba aims at focusing on the production of image sensors in its Japanese plants, scaling back the production of system chips. Not a big surprise, considering that in fiscal 2008, Toshiba’s chipmaking segment logged an operating loss of $3.4 billion.