Better yield rates may help TSMC win more Snapdragon 8 Gen 3 orders
Samsung began the mass production of its 3nm chips in June last year. The company has switched to the GAA (gate-all-around) transistor architecture for the new solutions. It is said to bring performance and power efficiency improvements over the existing FinFET (Fin field-effect) transistor architecture. However, the Korean firm struggled with yield rates, which is a measure of total usable chips out of every 100 manufactured. Its initial production reportedly only returned 20 percent usable chips. TSMC, on the other hand, kicked off its 3nm mass production less than a week ago but it has already achieved yield rates of about 80 percent. Maybe the company’s strategy of sticking to the FinFET transistor architecture helped it there. But its 3nm yield rates are comparable to 5nm in the early stages of production. This means TSMC is wasting fewer materials and resources, which may enable it to price its 3nm solutions aggressively. Its production capacity could also be higher than Samsung’s. All this will likely lead to the Taiwanese behemoth getting more manufacturing contracts. According to the Chinese media, Samsung has also improved its 3nm yield rates to around 60-70 percent in recent months. It sought help from San Jose, California-based software company Silicon Frontline Technology for this. However, the likes of Qualcomm and Nvidia, which switched to TSMC from Samsung, aren’t expected to return to the Korean firm anytime soon. Of course, if TSMC can’t supply their demand, they will have no other choice. But that’s a different matter altogether. The Taiwanese foundry remains their first choice.
Samsung and TSMC are already expanding their chip manufacturing capacities
As we enter the 3nm era, both Samsung and TSMC are expanding their chip manufacturing capacities. They are building new semiconductor facilities in the US as well as their respective home countries. The companies expect to begin operations in their new US factories by 2024. In the interim, they are expected to improve their 3nm solutions. Samsung and TSMC have already announced plans to introduce 2nm chips in 2025. We will have to wait and see if the former can close the game to the latter in the foundry market over the next few years.
