Bussard Ramjet
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Competition heats up in advanced IC process, equipment deployments
Top semiconductor players Taiwan Semiconductor Manufacturing Company (TSMC), Samsung Electronics and Intel are engaged in increasingly fierce competition not only in developing advanced fabrication processes but also in procuring advanced equipment, further extending their leads over Globalfoundries, United Microelectronics (UMC) and Semiconductor Manufacturing International Corp (SMIC), while also significantly driving up revenues of key equipment suppliers Applied Materials, ASML and their Taiwan partners, according to industry sources.
TSMC is kicking off volume production of 7nm process in the second quarter of 2018, its 7nm+ process incorporating EUV (extreme ultraviolet) technology is set for official run in early 2019, and its 5nm process node is slated for volume production in 2020, all demonstrating the foundry giant's leadership in IC scaling technologies.
The sources said Samsung, lagging behind TSMC by around one year in 7nm node, is fully gearing up to shorten the lead time for 7nm volume production and expand purchases of advanced equipment and materials. Samsung is even reportedly to place large orders for EUV equipment with the sole supplier ASML, seeking to make it more difficult for TSMC and Intel to obtain necessary equipment, the sources claimed.
As to Intel, it has adopted 14nm process for fabricating processors for four consecutive generations, but Chipworks has assessed that Intel's 14nm process can well rival 10nm process of both Samsung and TSMC in fin density and the overall transistor performance.
Intel's 10nm process volume production in 2H18
Intel said earlier that chips fabricated on its 10nm process boast the highest transistor density and the smallest metal pitch, technologically leading the counterpart process of rival competitors by one generation or around three years. But Intel will not ramp up its 10nm process production until the second half of 2018, when TSMC's more advanced 7nm process will be fully in volume production.
Meanwhile, Globalfoundries (GF), now focusing on 14nm FinFET process licensed by Samsung, has skipped 10nm and directly started in-house development of 7nm node, with trial production set for the second half of 2018. But many market watchers are quite conservative about the yield rate and performance of GF's 7nm process. They expect GF to extend its stay on the 14nm process node, especially given the high cost of over US$100 million per EUV equipment set needed to support the advanced node.
Likewise, Taiwan's UMC is also expected to stay at the 14nm stage. China's SMIC, which saw its profits shrink sharply in 2017, has to significantly boost the yield rate of its 28nm process to support its revenue and profit turnaround as its 14nm process will not be ready for volume production until the first half of 2019.
Top players' capex plans
Industry sources said that in line with the raging competition in advanced process technologies, the three heavyweight players have also readied substantial capital expenses these years. TSMC will see its capex fall in the range of US$10.5-11 billion in 2018, about the same as the US$10.8 billion for 2017. Intel has sharply boosted its 2018 capex to US$14 billion from US$11.5 billion in 2017. And Samsung Group's capex amounted to US$40.5 billion in 2017, a sharp increase by US$11.3 billion compared to 2016.
Strong demand for advanced semiconductor equipment has allowed major suppliers Applied Materials and ASML to hit new highs in revenues and profits in 2017, with ASML posting an annual profit increase of over 40% thanks to robust shipments of EUV equipment.
Taiwan's ASML supply chain partners such as EUV pod maker Gudeng Precision and EUV laser voltage stabilization module supplier Marketech International, as well as Applied Materials' contract production partner Foxsemicon Integrated Technology (an affiliate of Foxconn Group), and wafer reclaim equipment supplier Scientech are all expected to see their 2018 revenues and profits bolstered by the booming market demand.
Top semiconductor players Taiwan Semiconductor Manufacturing Company (TSMC), Samsung Electronics and Intel are engaged in increasingly fierce competition not only in developing advanced fabrication processes but also in procuring advanced equipment, further extending their leads over Globalfoundries, United Microelectronics (UMC) and Semiconductor Manufacturing International Corp (SMIC), while also significantly driving up revenues of key equipment suppliers Applied Materials, ASML and their Taiwan partners, according to industry sources.
TSMC is kicking off volume production of 7nm process in the second quarter of 2018, its 7nm+ process incorporating EUV (extreme ultraviolet) technology is set for official run in early 2019, and its 5nm process node is slated for volume production in 2020, all demonstrating the foundry giant's leadership in IC scaling technologies.
The sources said Samsung, lagging behind TSMC by around one year in 7nm node, is fully gearing up to shorten the lead time for 7nm volume production and expand purchases of advanced equipment and materials. Samsung is even reportedly to place large orders for EUV equipment with the sole supplier ASML, seeking to make it more difficult for TSMC and Intel to obtain necessary equipment, the sources claimed.
As to Intel, it has adopted 14nm process for fabricating processors for four consecutive generations, but Chipworks has assessed that Intel's 14nm process can well rival 10nm process of both Samsung and TSMC in fin density and the overall transistor performance.
Intel's 10nm process volume production in 2H18
Intel said earlier that chips fabricated on its 10nm process boast the highest transistor density and the smallest metal pitch, technologically leading the counterpart process of rival competitors by one generation or around three years. But Intel will not ramp up its 10nm process production until the second half of 2018, when TSMC's more advanced 7nm process will be fully in volume production.
Meanwhile, Globalfoundries (GF), now focusing on 14nm FinFET process licensed by Samsung, has skipped 10nm and directly started in-house development of 7nm node, with trial production set for the second half of 2018. But many market watchers are quite conservative about the yield rate and performance of GF's 7nm process. They expect GF to extend its stay on the 14nm process node, especially given the high cost of over US$100 million per EUV equipment set needed to support the advanced node.
Likewise, Taiwan's UMC is also expected to stay at the 14nm stage. China's SMIC, which saw its profits shrink sharply in 2017, has to significantly boost the yield rate of its 28nm process to support its revenue and profit turnaround as its 14nm process will not be ready for volume production until the first half of 2019.
Top players' capex plans
Industry sources said that in line with the raging competition in advanced process technologies, the three heavyweight players have also readied substantial capital expenses these years. TSMC will see its capex fall in the range of US$10.5-11 billion in 2018, about the same as the US$10.8 billion for 2017. Intel has sharply boosted its 2018 capex to US$14 billion from US$11.5 billion in 2017. And Samsung Group's capex amounted to US$40.5 billion in 2017, a sharp increase by US$11.3 billion compared to 2016.
Strong demand for advanced semiconductor equipment has allowed major suppliers Applied Materials and ASML to hit new highs in revenues and profits in 2017, with ASML posting an annual profit increase of over 40% thanks to robust shipments of EUV equipment.
Taiwan's ASML supply chain partners such as EUV pod maker Gudeng Precision and EUV laser voltage stabilization module supplier Marketech International, as well as Applied Materials' contract production partner Foxsemicon Integrated Technology (an affiliate of Foxconn Group), and wafer reclaim equipment supplier Scientech are all expected to see their 2018 revenues and profits bolstered by the booming market demand.
