With the expansion of Artificial Intelligence (AI) and the Autonomous Driving market, demand for application-specific integrated circuits (ASICs) is surging, sending a warm breeze through Korea's fabless (chip design) and design house industries. As a revenue structure that had relied on design service fees is reorganized around large-scale mass production, some say Korea's system semiconductor ecosystem has escaped chronic deficits and entered a high value-added mass production model.
According to the industry on the 24th, automotive AI Semiconductor fabless firm Bosssemiconductor finalized a 87 billion won Series A funding round the previous day. Cumulative investment has reached about 100 billion won. The deal goes beyond securing simple operating funds, carrying significance as it provides firepower for 2-nanometer advanced process design in response to demands from global original equipment manufacturers (OEMs) and for internalizing the next-generation packaging technology "chiplet" process.
Bosssemiconductor is pursuing a "hybrid strategy" that runs customer-specific ASIC projects in parallel with developing its own system on chip (SoC), "Eagle-N." The secured funds will be invested in expanding design personnel and advancing systems for mass production this year. Observers say the company is steering toward "Broadcom-style" growth that secures cash flow through stable ASIC orders and upgrades its own technological prowess, moving away from management that bet everything on a single chip.
ASICLAND, the only TSMC partner in Korea, signaled a smooth start early this year by signing a 25.4 billion won mass production contract for a storage controller ASIC. The deal amounts to about one-fourth of its recent annual sales, proving that a structural shift is in full swing from one-off design service (NRE) sales to "mass production-based sales" that ensure long-term revenue.
Semifive, which has widened its stride since listing, is also targeting 200 billion won in sales this year and a return to annual profit. Among the projects Semifive has won, designs based on 2-nanometer and 3D-IC reportedly account for more than half. As its platform business—combining its own IP (intellectual property) licenses with mass production margins—hits its stride, profitability is expected to improve.
GAONCHIPS, a key partner of Samsung Electronics Foundry, is also standing out in the Japanese market. Revenue from a 55.7 billion won AI accelerator project awarded by a major Japanese AI company is set to start contributing to results in the second half, likely lifting the share of overseas sales.
The reason the domestic ecosystem is gaining momentum is that global big tech companies want "custom chips" optimized for their own software rather than off-the-shelf semiconductors. In the past, firms drew up designs and collected fees; now they maximize added value by offering a "one-stop solution" that takes responsibility from design to foundry process management to final packaging. In ultra-fine processes like 2 nanometers, a design error can cause losses of hundreds of billions of won, pushing up the valuation of verified domestic partners.
In fact, as projects secured at the design stage steadily move into actual chip production, major corporations are raising the mass production share within total sales to the 30%–50% range, improving earnings visibility. An industry official said, "In an ultra-fine process environment, capabilities in managing Production yield and optimizing processes are as critical as design prowess," and added, "Preemptive investment aligned with expanding ASIC demand and the speed of conversion to mass production will be the yardstick that determines the corporate value of K-fabless firms going forward."