Wednesday, July 10th 2024
TSMC to Raise Wafer Prices by 10% in 2025, Customers Seemingly Agree
Taiwanese semiconductor giant TSMC is reportedly planning to increase its wafer prices by up to 10% in 2025, according to a Morgan Stanley note cited by investor Eric Jhonsa. The move comes as demand for cutting-edge processors in smartphones, PCs, AI accelerators, and HPC continues to surge. Industry insiders reveal that TSMC's state-of-the-art 4 nm and 5 nm nodes, used for AI and HPC customers such as AMD, NVIDIA, and Intel, could see up to 10% price hikes. This increase would push the cost of 4 nm-class wafers from $18,000 to approximately $20,000, representing a significant 25% rise since early 2021 for some clients and an 11% rise from the last price hike. Talks about price hikes with major smartphone manufacturers like Apple have proven challenging, but there are indications that modest price increases are being accepted across the industry. Morgan Stanley analysts project a 4% average selling price increase for 3 nm wafers in 2025, which are currently priced at $20,000 or more per wafer.
Mature nodes like 16 nm are unlikely to see price increases due to sufficient capacity. However, TSMC is signaling potential shortages in leading-edge capacity to encourage customers to secure their allocations. Adding to the industry's challenges, advanced chip-on-wafer-on-substrate (CoWoS) packaging prices are expected to rise by 20% over the next two years, following previous increases in 2022 and 2023. TSMC aims to boost its gross margin to 53-54% by 2025, anticipating that customers will absorb these additional costs. The impact of these price hikes on end-user products remains uncertain. Competing foundries like Intel and Samsung may seize this opportunity to offer more competitive pricing, potentially prompting some chip designers to consider alternative manufacturing options. Additionally, TSMC's customers could reportedly be unable to secure their capacity allocation without "appreciating TSMC's value."
Source:
via Tom's Hardware
Mature nodes like 16 nm are unlikely to see price increases due to sufficient capacity. However, TSMC is signaling potential shortages in leading-edge capacity to encourage customers to secure their allocations. Adding to the industry's challenges, advanced chip-on-wafer-on-substrate (CoWoS) packaging prices are expected to rise by 20% over the next two years, following previous increases in 2022 and 2023. TSMC aims to boost its gross margin to 53-54% by 2025, anticipating that customers will absorb these additional costs. The impact of these price hikes on end-user products remains uncertain. Competing foundries like Intel and Samsung may seize this opportunity to offer more competitive pricing, potentially prompting some chip designers to consider alternative manufacturing options. Additionally, TSMC's customers could reportedly be unable to secure their capacity allocation without "appreciating TSMC's value."
47 Comments on TSMC to Raise Wafer Prices by 10% in 2025, Customers Seemingly Agree
Vote with your wallets. Boycott these shenanigans.
Which means that AMD could very well use Samsung's corresponding processes (3GAE SF3E, 3GAP SF3, 4LPE SF4E, 4LPP SF4, 4LPP+ SF4P, 4HPC SF4X, 4LPA SF4U, 7LPP, 6LPP), and still get better products than what they currently offer.
Bet Intel won't even blink at the increase. They need TSMC.
Poor management practices... doesn't mean they will stay behind TSMC, same holds true for Intel, SMIC
If for some reason TSMC drops the ball for a couple of years they will no longer be #1
their n3 issues allowed intel to gain a bit on them already
I truly think AMD should consider moving most of their output to Samsung 2nm. If Samsung can make a smartphone chip for the 2026 Galaxy, they *should* be able to make dang near anything AMD should need...in theory.
Now, I don't know how smoothly that is progressing; the yields nor the pricing, but given how long they will have been on GAAFET by that point (without BSPD), one would *think* yields should be decent, performance comparable to what's available for HPC at TSMC, and pricing advantageous. That's one of the advantages of going chiplet; in theory AMD could sneak into risk production on a node typically reserved for mobile (if they design toward a lower voltage and/or Samsung can produce chips that can take advantage of higher voltage from the beginning and/or close to it).
As I've also said, while when one looks at TSMC's roadmap they see things like N2P etc, remember Apple (if not then nVIDIA) typically has an entire generation on lock. So while some may look at the competitive landscape and question why anyone may use Samsung 2nm when TSMC's N2P/1xA is on the way, I would instead say it is a competitor to N3P. While I can't say for certain if it will have that level of performance/reliability (wrt voltage response), it would appear to be the case wrt at least density. I think that gives AMD, given their already-proven propensity towards parallelism and smaller chips, ntm optimized clocks, room to expand that mindset while perhaps creating more robust inherent hardware running at a lower voltage to maintain a respectful TDP (as nVIDIA has done for quite a while now), rather than continuing the 'higher-speed/smaller die size' GPU methodology.
But, like, IDK. That one guy from AMD (I know, specific and well-sourced...I apologize) said they're sticking with TSMC into the future. That may be that...but I still can't help but feel there's some perfect concoction of what they did with GloFo (really Samsung) 14nm...a 'Zen Moment'...if you will...or Polaris if you won't...mixed with chiplets...on Samsung 2nm. It just 'feels' like a good opportunity for someone to seize. It very-well might not be AMD and may be someone else (like Qualcomm), but I wouldn't rule it out as a realistic, if not tantalizing alternative (and way to keep prices down) versus TSMC.
that and AMD is making plenty on their ryzen chips, they don't need to move to a different manufacturer to be able to lower prices, they don't have to why charge less if you don't have to...
it would be an insane 25% hike and that means trouble for ZEN5 on N4 and NAVI44 also on N4.
That's hardly a fair comparison...in-fact it makes no sense. It only shows you how shrewd of a company nVIDIA is when it comes to bargaining.
1. AMD's chips would not need to massive. This isn't Finfet, it's GAAFET (which Samsung has been producing and TSMC will only just start to produce). Lots of stuff that's different, and not comparable at all.
2. This isn't about now, it's about the future. TSMC's costs are going up; this is fact, and allocation on cutting-edge nodes is at a premium that may not satisfy AMD and/or cut them out.
Samsung's price was likely already competitive, but now may be even more-so. It may have to be, especially given there haven't been many (any?) massive orders on new nodes for quite some time (SD8G1?).
Why would a company take a worse DEAL? It's honestly not about the technology; they can build/design around that.
If it was about the best technology nVIDIA would have never used Samsung ever. It's about allocation and profit margin.