Samsung is reportedly planning to supply HBM3 memory and packaging facilities to NVIDIA for its AI GPUs as the company plans to expand its supply chain.
Samsung Comes For TSMC Market Share, Proposes Unique Solution For NVIDIA's Huge AI GPUs Orders
Currently, TSMC dominates NVIDIA's orders for manufacturing wafers and supplying advanced 2.5D semiconductor packaging. However, due to a massive influx of orders, it is being reported that TSMC is unable to handle NVIDIA's demand which is why the company is now planning to adopt a dual-sourcing approach to ensure a steady supply chain.
The primary memory chips used in the AI GPU, HBM3, are currently being supplied by SK Hynix. TSMC has expressed concerns about the huge workload involved with the 2.5D CoWoS packaging for these chips. This has caused NVIDIA to look for other suppliers, with potential suppliers being US-based Amkor Technology and Siliconware Precision Industries Taiwan (SPIL) as previously been pointed out by DigiTimes. Samsung has also entered through its AVP (Advanced Package) division, offering NVIDIA a unique proposition.
Samsung reportedly offered to acquire semiconductor wafers from TSMC and the HBM3 from its memory division. Using the company's unique I-Cube 2.5D packaging, Samsung has sorted out a way for NVIDIA to have a supplier responsible for all development stages potentially. Moreover, the company has also pledged to appoint several engineers to this task with a future proposal of directly acquiring the semiconductor wafer from the foundry division.
Samsung has already initiated the mass manufacturing of HBM3 memory, with reports suggesting that the memory boasts faster speeds (at 6.4 GB/s) and much lower energy consumption than SK Hynix. The process has gained attraction, especially from AMD, since its latest MI300 Instinct APUs are equipped with Samsung's HBM3. If the NVIDIA deal goes through, it is said that Samsung could acquire a total order volume of 10%.
The deciding element for this deal would be the quality of Samsung's HBM3 and 2.5D packaging and whether it fulfills NVIDIA's criteria. Samsung & TSMC are technically in a race, with both companies rapidly developing facilities to cater to their partners. If Samsung gains NVIDIA's trust through its products, TSMC will be in danger, with its market share potentially at stake.
However, rest assured that this deal involves a lot of complexities, and it could tarnish the NVIDIA-TSMC relationship, which won't benefit either of the companies. However, one thing is sure, Samsung is pushing the throttle here, whether it is through its foundry business or memory division. It will be interesting to see how things unfold, especially after a recent report claiming that Samsung is ahead of TSMC regarding yield rates and fabrication technology.
News Source: TheElec
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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