According to a report from South China Morning Post, Wang Tao, Executive Director, Chairman of the ICT Infrastructure Managing Board at Huawei, recently stated at the World Semiconductor Conference and Nanjing International Semiconductor Expo that Huawei’s advanced Ascend 910B AI chip achieves an efficiency of up to 80% compared to NVIDIA’s A100 when training large-scale language models. In terms of specific test performance, it surpasses NVIDIA’s A100 AI GPU by 20%.

Reportedly, leading Chinese companies such as Tencent Holdings and Baidu have also purchased the Ascend 910B chip for conference tasks, indicating substantial market adoption of the chip and encroaching on NVIDIA’s AI chip market share.

Huawei’s self-developed AI chip, the Ascend 910B, adopts the advanced Da Vinci architecture and supports various AI computing tasks such as deep learning and inference. The chip boasts computing capabilities of up to 320 TFLOPS in half-precision (FP16) and 640 TOPS in integer precision (INT8), all while consuming 310W of power.

Reportedly, it’s expected that Chinese tech giants may now be considering a shift towards local AI products, which could pose a challenge to NVIDIA. Currently, China accounts for 17% of NVIDIA’s revenue in the 2024 fiscal year, making the competition in the Chinese market increasingly fierce for NVIDIA.

According to a previous report from Reuters, NVIDIA, in response to the US ban on high-end chips, provided three chips specifically for the Chinese market, with the H20 chip receiving significant attention.

Hence, there are reports of a price reduction for the H20 chip to stimulate demand and address the intense competition from Huawei in the Chinese market. It’s reported that the price of the H20 chip is over 10% lower than Huawei’s Ascend 910B chip. The chip is reportedly to be sold at approximately 100,000 yuan per unit, while Huawei 910B sold at over 120,000 yuan per unit.

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• [News] NVIDIA Reportedly Facing Price Cut Pressure of H20 Chip in China Amid Competition with Huawei
• [News] Hurdles in Acquiring NVIDIA’s High-End Products: Assessing the Progress of Eight Chinese AI Chip Companies in Self-Development

(Photo credit: Huawei)

The ongoing tightening of US restrictions on China’s access to advanced chips and production equipment may have significant impact on China’s semiconductor development progress. According to a report from Liberty Times, a top executive at Huawei, a Chinese tech giant, admitted that China’s ambitious semiconductor efforts may have reached a plateau. This statement has surprised many in the industry, as China has consistently expressed confidence in its semiconductor growth capabilities.

During the Mobile Computility Network Conference in Suzhou, China on June 9th, Zhang Ping’an, the Chief Executive Officer of Huawei Cloud Services, expressed concern that China, due to US sanctions, is unable to purchase 3.5nm chip equipment.

Recently, Huawei successfully mass-produced 7nm chips without using lithography technology. This development has surprised the global semiconductor market and has led to speculation that Huawei may soon also mass-produce 5nm chips.

Per a report from Business Korea, Zhang further noted that manufacturing 3.5 nm semiconductors necessitates EUV lithography machines, which Huawei is reportedly working on independently. However, overcoming U.S. and Dutch patents to internalize this technology is considered highly challenging.

Previously, as per a report from Chinese media outlet “Phoenix New Media,” Zhang Ping’an also pointed out that the semiconductor industry in China currently cannot directly compete with developed countries in cutting-edge processes, such as 3nm and 5nm. This is an indisputable fact, but it does not mean that China’s semiconductor industry has no prospects for development. Furthermore, Zhang believed that the semiconductor industry in China should be more focused on deepening efforts in relatively mature processes, such as 7nm, to enhance product performance and reliability, meeting the needs of the market and users.

Moreover, some Chinese manufacturers are exploring ways to overcome these restrictions. Notably, Chinese DRAM manufacturer ChangXin Memory Technologies is reportedly preparing to mass-produce 18.5nm DRAM to circumvent US sanctions on DRAM equipment below 18nm.

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• [News] Huawei Executive Acknowledges Production Bottleneck, Addressing that Solving 7nm Issues Would be Good Enough 
• [News] China’s Big Fund Phase Three Commences, Injecting 344 Billion RMB into Semiconductor Industry Growth

(Photo credit: iStock)

MediaTek is making further strides in AI applications, focusing on the integration of smartphones and AR/MR devices. According to a report from the Economic Daily News, they look to capitalize on the significant business opportunities presented by 3D imaging combined with generative AI for immersive experiences. The sources cited in the same report indicated that MediaTek has formed an alliance with Meta, leveraging MediaTek’s Dimensity series smartphone chips as a platform alongside Meta’s Quest devices to target this market.

Previously, tech giants like Apple and Qualcomm have also recognized the potential of 3D imaging combined with generative AI for immersive experiences, and thus have been actively developing their strategies. While Apple builds its ecosystem through iPhones and Vision Pro headsets, Qualcomm has strengthened its collaboration with Google. With Meta and MediaTek entering the fray, the competition in the 3D imaging market will be further intensified.

Industry sources cited by the same report indicated that the generative AI business opportunity is set to explode, as cloud service providers (CSPs) are actively building AI servers, engaging in a “computing power war.” This hints that future AI market demand is likely to extend from the cloud to edge devices, thereby expanding AI applications to smartphones and AR/MR-related end-user devices.

Apple, which just showcased its upcoming products at WWDC, has launched the MR device Vision Pro previously, and is reportedly looking to expand its AI technology layout further. This includes integrating AI capabilities into iOS 18 in the iPhone 16 series, which will be released in September.

Meanwhile, per the same report, it’s expected that the iPhone 16 series will significantly enhance 3D photography features and improve integration with the Vision Pro. This indicates that 3D imaging will become a new application frontier in Apple’s AI strategy.

Non-Apple camps are also sensing these trends and opportunities. Qualcomm is reportedly teaming up with Google to integrate related systems in smartphones and wearable devices.

It is reported that Google has already strengthened its hardware development team in Taiwan. By doing so, the tech giant is possibly aiming to collaborate directly with major semiconductor companies like TSMC to develop 3D imaging applications. To bolster its future AI strategy, Qualcomm will collaborate with Google to integrate 3D imaging platforms into smartphones.

Industry sources cited by the report suggested that beyond language models, imaging is one of the AI applications that provide tangible experiences for users. Currently, AI applications in imaging are mostly focused on photo editing and cartoonization. However, with the improvement of camera functionalities in mobile devices, AI will begin to be integrated into 3D imaging.

As a result, major mobile platform providers will not only emphasize AI processing chips in their future hardware specifications but also upgrade imaging hardware specifications. This is expected to become a new battleground, potentially sparking a new wave of AI-driven smartphone upgrades.

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• [News] Four Semiconductor Applicants for Taiwan’s Chip Act Tax Incentives – TSMC and MediaTek Expected to Benefit
• [News] MediaTek Announces 4nm Dimensity 7300 Series Chips, Supporting Foldable Devices

(Photo credit: MediaTek)

The continuous increase in silicon content driven by AI servers, high-performance computing (HPC) applications, and the AI integration of high-end smartphones has led to a surge in demand for semiconductors. According to a report from the Economic Daily News, major companies such as Apple, Qualcomm, NVIDIA, and AMD are reportedly securing substantial production capacity for TSMC’s 3nm process family. This has resulted in a queue of clients stretching all the way to 2026.

TSMC has a consistent policy of not commenting on individual client information. Regarding whether the high demand for production capacity will lead to price increases to reflect its value, TSMC emphasizes that its pricing strategy is always strategically oriented rather than opportunistically driven. TSMC will continue to work closely with clients to provide value.

As per sources cited by the same report, TSMC is not a company that raises prices arbitrarily. Reflecting value does not equate directly to price increases, even though the company holds a leading edge in advanced process technology. There are various ways for TSMC to demonstrate value to its customers.

The members of TSMC’s 3nm family include N3, N3E, N3P, as well as N3X and N3A. As the existing N3 technology continues to be upgraded, N3E, which began mass production in the fourth quarter of last year, targets applications such as AI accelerators, high-end smartphones, and data centers. N3P is scheduled for mass production in the second half of this year and is expected to become mainstream for applications in mobile devices, consumer products, base stations, and networking through 2026. N3X and N3A are customized for high-performance computing and automotive clients.

Source: TSMC

Industry sources cited by Economic Daily News in the report believe that with clients rushing to book production capacity, TSMC’s 3nm family will continue to experience tight supply over the next two years. This does not yet include Intel’s outsourcing demand for CPUs.

Due to the fact that TSMC’s 3nm family production capacity has already been fully allocated by customers for this year and next, the company’s plan to triple the relevant capacity this year compared to last year is still insufficient. To ensure an uninterrupted supply for the next two years, TSMC has implemented several measures to expand its production capacity.

Previously, during an earnings call, the company announced that due to robust demand, its strategy includes converting some 5nm equipment to support 3nm production. Industry sources cited by the report also reveal that TSMC’s total 3nm family capacity is continuously increasing, with monthly production capacity expected to reach between 120,000 and 180,000 wafers.

Meanwhile, the sources cited by the Economic Daily News indicate that the main sources of orders for TSMC’s 3nm family include major clients such as Apple, Qualcomm, NVIDIA, and AMD. Apple is expected to launch the iPhone 16 series as early as September, which is anticipated to be the first iPhone with AI capabilities, potentially sparking a new wave of upgrades among Apple fans.

Source: TSMC

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• [News] NVIDIA CEO Jensen Huang Supports C.C. Wei’s Theory and Backs for TSMC to Increase Price
• [News] TSMC Says Tripling 3nm Capacity This Year Still Not Enough

(Photo credit: TSMC)

Converting LCD panel factories into semiconductor bases seems to emerge as one of the latest trends in the semiconductor industry. According to a report by Nikkei News, Intel plans to utilize Sharp’s LCD panel factory in Japan, and collaborate with Japanese companies to develop semiconductor production technology.

Intel will reportedly collaborate with 14 Japanese suppliers, including Omron, Resonac, and Murata Machinery, to develop “backend process” technologies responsible for semiconductor assembly. They plan to use Sharp’s LCD panel factory as a research and development site, as the target locations potentially being Sharp’s Kameyama plant or Mie plant.

For display manufacturers, their ability to effectively control contaminants in the manufacturing environment directly impacts the fluctuations in yield. LCD panels, like semiconductors, suffer from decreased yield if even minute dust or particles are introduced during the manufacturing process. Thus, LCD panel factories are equipped with clean rooms designed to minimize dust and particles, making them suitable for both production and semiconductor research and development.

The report also stated that in addition to Intel, Rapidus, which aims to mass-produce cutting-edge 2-nanometer chips, and Mitsubishi Electric will also utilize existing LCD factories for semiconductor research and development.

In mid-May, per another report by Nikkei, Sharp decided that Sakai Display Products (SDP), its 10th generation panel factory, which produces large-sized LCD panels for TVs, would cease production by the end of September. Additionally, production of medium and small-sized LCD panels would be reduced. Instead, the company intends to seek collaboration with other companies and optimize its factories to improve profitability.

According to the report, currently, Sharp produces medium and small-sized panels at its Kameyama, Mie, and Hakusan factories. Daily production at Kameyama’s second factory is expected to decrease from 2,000 panels to 1,500, while production at Mie’s third factory will drop from 2,280 panels to 1,100, a 52% reduction, while the OLED production line at the Tenjiku factory will be closed.

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• Sharp Announces Closure of Sakai Gen 10 Line, Supply Cut of 5 Million TV Panels Expected in 2025, Says TrendForce

(Photo credit: Intel)