The transition from 7nm to 5nm is going to be difficult for TSMC, with Samsung and Intel lagging behind in transistor density, TSMC is taking over most of the designs, forcing them to increase their investment capacity and with This will increase the capital that it invests in its production.
The current situation of TSMC
There is no doubt that the most important semiconductor manufacturer of the moment is TSMC at the moment, which thanks to its 5 nm node has put itself at the forefront of technology above its rivals, Samsung and Intel. Which leads the Taiwanese foundry to have to expand its production capacity, which is why they plan to expand it by one hundred billion dollars.
TSMC is having a good time, thanks to Apple’s commercial success with its own-designed SoCs manufactured under TSMC’s 5nm node. If we talk about its 7 nm node where AMD is its main client, we have from the different Ryzen CPUs and SoC for both PCs and new generation consoles, as well as RDNA 2 graphics cards. So at the moment, AMD and Apple they are your top customers.
However, it has not been easy for TSMC, since they lost NVIDIA by switching to Samsung’s 8 nm node and the commercial blockade of Huawei left a good part of the production free. In any case, we have to bear in mind that the contracts with the consoles are long-term and everything points to a return from NVIDIA for the 5 nm of TSMC.
TSMC invests 100,000 million for its 5 nm node
TSMC is a foundry that does not design its own processors, so it needs to have as many customers as possible that make use of its technologies. In addition, we have to add the increase in development and deployment costs of the new manufacturing nodes, which translates into processors that are much more expensive to manufacture by absorbing all the costs.
That is why in TSMC they are going to make an investment of one hundred billion dollars in the next three years, which contrasts with the investment that Samsung will make of one hundred and sixteen billion dollars for a whole decade and twenty billion dollars per share. of Intel in new factories.
It must be taken into account that TSMC would not make such an investment if it did not have designs already assured to be mass-produced in its foundries in the next 3 years. These include, among other things, the new Zen 3+ and Zen 4 CPUs, Intel Xe-HPG, AMD RDNA 3 and NVIDIA Lovelace / RTX 4000 GPUs. As well as mobile SoCs from Apple, Qualcomm and other brands.