On Tuesday, Samsung Electronics Co Ltd indicated that it would close a CPU core division at a US facility. Analysts have said that the moved dims the prospects of the company’s Exynos-branded mobile chips. The company has indicated that the facility with around 250 staff will no longer produce the chips.

Exynos chips have been facing competition for Qualcomm’s snapdragon

The Exynos mobile chips were a significant milestone for the company in its attempts to minimize dependency on memory chips. They could also enhance sales of the logic chips used in powering autonomous vehicles and mobile devices.

However, the chips have been facing competition from Qualcomm’s (NASDAQ:QCOM) snapdragon family. The chips are popular in the company’s Galaxy series phones and have been struggling to attract customers. The move shows how the Exynos chips have been difficult to promote. The company will now depend on ion ARM’s cores going forward for performance tasks.

According to Cape Investment & Securities analyst Park Sung-soon, the Exynos chips are nowadays not used anywhere. They have been losing ground in the processor market, leading to concerns regarding the South Korean firm’s competitiveness. This has raised speculation about the company adopting core designs from semi-custom or ARM designs. According to Park, it is unlikely that Samsung will completely give up the Exynos business.

Samsung to let go 300 employees in Austin and San Jose R&D Centres

Despite the terminating the CPU core projects, the company expects to continue developing and producing Exynos chips. There is a possibility that close to 300 employees could move to other projects. The affected employees will most likely from the Austin R&D center that has worked on CPU core research since 2010. A company spokeswoman said that they would relocate or lay off the project team in the San Jose Advanced Computing.

In a statement about the logic business, the company said that the move was based on the assessment of System LSI business and the need to be competitive. As a result, the company chooses to transition part of its research and development teams in the US.