The AI boom has resulted in TSMC battling to increase its manufacturing capacity for clients to fulfill 3nm chip orders, leaving a massive opportunity for Samsung to capitalize on. However, even though the Korean giant has made strides in bringing its 2nm GAA technology to U.S. soil in the form of its Taylor plant, its reliability in manufacturing higher volume at stable yields remains in question.
While there have been talks of Samsung becoming a viable alternative to TSMC, companies like Tesla and Qualcomm are only considering a dual-sourcing strategy because they now have a backup option to a foundry that has access to cutting-edge lithography. Unfortunately, that’s not a guarantee for Samsung to secure chip orders, as we discuss below what challenges customers continue to face.
At lower yields, which Samsung is currently facing with its 2nm process, the entire process from start to finish gets disrupted
As the chip’s manufacturing process becomes more complex, so does its price, forcing customers like Tesla and Qualcomm to seek alternatives, with Samsung currently being the only one that can showcase technology similar to TSMC. Unfortunately, Qualcomm has attempted to materialize a dual-sourcing approach, but it has been unsuccessful because Samsung’s 2nm GAA yields currently stand at 60 percent, making it 10 percent less than the suitable benchmark for Qualcomm.
Even with Tesla successfully completing the design tape-out of the AI5, the EV manufacturer continues to rely on TSMC for bulk orders, with DigiTimes reporting that Samsung is mainly kept as a backup option for specific AI5 versions. For the Korean technology behemoth, Tesla’s decision serves both as an opportunity and a harsh reality because when mass producing advanced nodes at scale, DigiTimes mentions the myriad of problems when low yields persist.
“At advanced process nodes, the manufacturing cost of a single chip is already extremely high. If yields are low, the problem is not limited to higher wafer costs; it also disrupts deliveries, delays module integration, and ultimately weakens the competitiveness of the entire system.”
However, Tesla appears braver than Qualcomm, as it has partnered with an unstable foundry that can not only create supply chain issues but also threaten the entire product roadmap. Fortunately, Samsung having access to the 2nm GAA process brings another opportunity to the table, and with its Exynos 2700 expected to be announced later this year, its performance and increased adoption can turn around the company’s semiconductor and foundry business.
News Source: DigiTimes
About the author: Omar Sohail is a reporter and analyst for Wccftech's mobile section, specializing in the technology and business of the mobile industry. His expertise lies in the intricate hardware supply chain, covering developments in semiconductor manufacturing, chip lithography, and camera sensor technology.
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