Reducing corners: Samsung’s Texas semiconductor fab was supposed to be a key facility for the mass manufacturing of superior processes under 4nm. Nonetheless, a number of setbacks have raised questions on Samsung’s capacity to compete within the superior chip manufacturing area. The corporate is quickly shedding floor to TSMC, and except it regains its footing, its decline may considerably affect the semiconductor panorama.
Samsung is going through ongoing challenges with 2nm chip yields, prompting the corporate to withdraw personnel from its $17 billion Taylor, Texas plant, which was designed to be a hub for mass manufacturing of superior processes under 4nm. This choice, first reported by Enterprise Korea, comes amid repeated delays within the firm’s mass manufacturing timeline, now pushed again from late 2024 to 2026.
Samsung’s foundry yield for processes under 3nm presently stands under 50 p.c, with its Gate-All-Round (GAA) know-how yield reportedly as little as 10 to twenty p.c. In distinction, the superior course of yields at its essential competitor, TSMC, stand round 60 to 70 p.c. In the meantime, Samsung’s chip manufacturing market share is dwindling because the efficiency hole widens, with TSMC holding 62.3 p.c of the worldwide foundry market, whereas Samsung’s share has dropped to 11.5 p.c.
High 10 foundries by income (Q2 2024)
| Rating | Firm | Income (2Q24) | Income (1Q24) | QoQ | Market Share (2Q24) | Market Share (1Q24) |
|---|---|---|---|---|---|---|
| 1 | TSMC | 20,819 | 18,847 | 10.5% | 62.3% | 61.7% |
| 2 | Samsung | 3,833 | 3,357 | 14.2% | 11.5% | 11.0% |
| 3 | SMIC | 1,901 | 1,750 | 8.6% | 5.7% | 5.7% |
| 4 | UMC | 1,756 | 1,737 | 1.1% | 5.3% | 5.7% |
| 5 | GlobalFoundries | 1,632 | 1,549 | 5.4% | 4.9% | 5.1% |
| 6 | Huahong Group | 708 | 673 | 5.1% | 2.1% | 2.2% |
| 7 | Tower | 351 | 327 | 7.3% | 1.1% | 1.1% |
| 8 | VIS | 342 | 306 | 11.6% | 1.0% | 1.0% |
| 9 | PSMC | 320 | 316 | 1.2% | 1.0% | 1.0% |
| 10 | Nexchip | 300 | 310 | -3.2% | 0.9% | 1.0% |
| Complete of High 10 | 31,962 | 29,172 | 9.6% | 96.0% | 96.0% | |
To see how far Samsung has fallen behind, one solely has to take a look at TSMC’s Arizona facility, the place current trial manufacturing has yielded outcomes corresponding to these of its established crops in Taiwan. The ability is on monitor to start manufacturing at its first fab within the first half of 2025. The second fab, set to start manufacturing in 2028, will produce chips utilizing 2nm course of know-how with next-generation nanosheet transistors, along with 3nm know-how.
Samsung is now rethinking its technique and has stored solely a skeleton crew on the Taylor plant. The corporate has a preliminary settlement with the U.S. authorities for near $7 billion in subsidies beneath the CHIPS Act, which is now in danger, because the deal requires the plant to be operational.
To be honest, TSMC’s Arizona facility additionally skilled setbacks in its development and staffing. Nonetheless, Samsung has been unable to resolve its points, regardless of Chairman Lee Jae-yong’s private intervention, together with visits to main tools suppliers like ASML and Zeiss in quest of options.
It could be that Samsung’s challenges lengthen past technical points. The pervasive forms inside Samsung, sluggish decision-making, and low compensation are the primary causes for the decline in foundry competitiveness, a semiconductor professor informed Enterprise Korea. “The delayed funding timing in comparison with 20-30 years in the past additionally signifies that the administration isn’t absolutely conscious of the present actuality, necessitating a basic overhaul of the administration system,” this individual stated.
Samsung’s current struggles are notably putting, given its historical past in semiconductor manufacturing. In 2022, the corporate grew to become the primary foundry to attain quantity manufacturing of 3nm chips, outpacing TSMC by almost six months and Intel by a number of years. Samsung had formidable plans to keep up its technological edge by being first to market with 2nm transistors. Nonetheless, it now seems that this aim could also be out of attain.
