Price hikes and market growth come at the same time
At present, the global semiconductor supply chain capacity continues to be in short supply. The new crown epidemic has affected supply, while 5G and new energy have driven strong downstream demand, resulting in a global chip shortage.
According to IC designers, a number of wafer foundries in Taiwan are preparing to raise the quotations of mature processes of 8 and 12 inches again, with a price increase of at least 5-10%, and the price increase notice will be until 2022Q1.
Since the beginning of the tight production capacity in Q4 last year, Taiwanese foundries have raised prices at least twice, with a cumulative increase of more than 30%. The 21Q2 performance of Taiwanese factories such as UMC and NMC hit a record high.
IC Insights said in a Sept. 22 report that the global chip foundry market is expected to grow 23 percent this year to $107.2 billion.
For reference, the market grew by 23% in 2017, showing the highest annual growth rate ever.
It also said that chip foundry is expected to reach $151.2 billion by 2025, with an average annual growth of 11.6%.
It is expected that the growth rate of foundry companies such as TSMC will exceed that of foundry departments such as Samsung Electronics and Intel. The sales and sales growth rates of the former are expected to be US$87.1 billion and 24% respectively this year; Intel is expected to grow by 18% this year. The average annual growth rate through 2025 is 9%.
Head anxiety from TSMC
In terms of advanced process technology, Intel has been left behind by TSMC and Samsung. Although Samsung has kept pace with TSMC, it is far behind TSMC in the market.
In this context, TSMC does not need to be too nervous. But the problem appeared, and Samsung and Intel started to move, and it was not a small move.
Therefore, in terms of expansion speed, TSMC can be said to be the leader.
The expansion of the Nanjing factory and the investment and construction of a factory in Phoenix, Arizona, USA, have already reached nearly 15 billion US dollars.
It will invest in the construction of a special process wafer factory in Japan to provide 22nm and 28nm process capacity. It is estimated that the factory will start construction in 2022 and enter mass production in 2024.
2025 will be the key node of the head competition
At present, TSMC, Samsung, and Intel focus on 2025 in their own technology roadmaps.
At the Intel On Technology Innovation Summit on October 28, Intel stated that it will develop and innovate based on the principles of openness, choice and trust.
Judging from the content of the conference, Intel may surpass TSMC in the field of foundry in 2025 and regain its throne in the chip field.
Intel hopes to regain Apple, a big customer. You know, Intel was already a supplier of Apple’s chips in 2005, but it was abandoned by Apple in 2020, and they worked together for 15 years.
However, Gelsinger also thought of a good way to regain Apple, a major customer, that is to manufacture chips for Apple.
Intel has already received large chip foundry orders from many American giants such as Amazon and Qualcomm.
In the current extreme shortage of chip manufacturing capacity, this may become an important factor in attracting Apple.
This year, Intel is accelerating its own chip manufacturing capabilities, not only planning to spend 20 billion US dollars to build two new chip factories in the United States, but also preparing to invest 80 billion euros to build two factories in Europe.
According to the plan, by 2024, Intel will mass-produce 20A process chips (equivalent to 2nm), while TSMC’s research and development progress is declining, and the mass production of 2nm process may take until 2025.
Intel said in July that its factories would start making chips for Qualcomm and laid out a roadmap to expand the company’s foundry business to catch up with rivals such as TSMC and Samsung Electronics by 2025.
Intel will definitely catch up in the next few years and be ahead of TSMC in some ways, and there are people at Intel who have devoted their time and energy to researching new material and technology configurations and improving chip performance.
Samsung Electronics said recently that it will commercialize its 2-nanometer transistor process technology by 2025 to compete with larger rival TSMC in chip processing.
Mass production of 2-nanometer chips will begin in 2025, and production of customer-designed 3-nanometer chips will begin in the first half of next year. The second-generation 3-nanometer chips are expected to be produced in 2023.
However, TSMC, the leader in the chip foundry market, has yet to announce its mass production roadmap for 2nm chips.
This also highlights Samsung’s efforts to close the market share gap with TSMC and its ambition to catch up with TSMC in advanced chip manufacturing.
Data from market research firm Counterpoint Research shows that in terms of revenue, as the world’s second largest foundry, Samsung accounted for 14% of the global chip foundry market in the second quarter, far lower than TSMC’s 58%.
Samsung hopes to invest 133 trillion won ($116 billion) by 2030 to become the world’s largest semiconductor foundry.
Mass production of domestic high-precision chips
In late July 2021, YMTC’s 128-layer stack flash memory chips have entered the stage of mass production and shipment.
The 128-inch stack of flash memory chips launched by YMTC will impact Samsung’s share in my country’s domestic flash memory market and affect the revenue of Samsung’s flash memory business market.
At present, SMIC mainly relies on mature processes. After all, FinFET/28nm contributes less than 15% of the revenue; the 55/65nm process accounts for 29.9% of the revenue; followed by 0.15/0 .18um, the revenue share is as high as 28.4%, and the two major processes account for nearly 60%.
SMIC’s current share of global chip foundry orders is only about 5%, which means that SMIC’s production capacity is far from enough to meet the domestic market demand.
As long as there is production capacity, whether it is 28nm, 55nm, 14nm, or even 65nm, as long as there is production capacity, there is no need to worry about orders, and 28nm is not behind.
With the significant growth of market forecasts, the previous competition and improvement of giants, and the uncertainty of the current epidemic, it is clear that 2025 will be a lively year.
Reference for some information: Magnesium.com: “In 2025, chip foundry will usher in the “top of the decisive battle”?”, Global Times: “Target TSMC! Intel plans to regain the leading position in the chip foundry industry in 2025″, Shangguan: ” Intel will manufacture chips for Qualcomm, and the goal: to catch up with TSMC and Samsung in 2025