Low-price SSDs (Solid-state drives) may have become a thing of the past in 2024. The three major memory manufacturers are reportedly pushing up the prices of NAND Flash, leading to rumors of a 50% increase in prices for all SSDs as well. The successive hikes in NAND Flash prices by suppliers are already beginning to impact the end market.

Industry sources cited by ctee have indicated that at the beginning of 2024, there is a continuous stream of news regarding price increases for memory products. However, as of now, new transaction prices have not been observed, and the situation is being closely monitored.

Furthermore, sources cited by ctee also stipulate that, since reaching its lowest point in August 2023, NAND Flash prices have experienced a cumulative increase of approximately 40% to 90%.

Previously, significant losses in NAND Flash led manufacturers to actively reduce production and increase quotes. Currently, manufacturers have yet returned to a break-even condition. It is widely anticipated within the industry that the upward trend in NAND Flash prices will persist into the first quarter of 2024. The aim is to promptly raise prices and achieve a break-even point.

According to TrendForce’s previous estimates, the average quarterly increase in prices for Mobile DRAM and NAND Flash (eMMC/UFS) in the first quarter of 2024 is expected to expand to a range of 18% to 23%. Additionally, it is not ruled out that in a market characterized by limited competition or in situations where brand customers panic and engage in price chasing, the increase in prices could further escalate.

The upward trend in NAND prices has also led to an increase in the prices of storage products in the consumer end market. According to the latest information from the supply chain in China cited by the media outlet mydrivers, it’s reported that SSD products are experiencing their first price hike in nine quarters and manufacturers are planning to continue requesting price increases after 2024 Q1.

An industry source suggests that NAND manufacturers, facing losses, have been actively adjusting prices. Since these manufacturers also produce SSDs for their own brands, their own brands need to follow suit in price increases, potentially influencing the entire market.

Recent rumors have also claimed that the SSDs from memory manufacturers are set to increase by 50%, with some sources suggesting at least a 30% hike. Whether this is an tentative price adjustment or a market-driven price surge prompted by demand remains to be closely observed.

Read more

• Mobile DRAM and eMMC/UFS Prices to Surge 18–23% in 1Q24 as Smartphone Brands Continue Stockpiling, Says TrendForce
• [News] Market Anticipates a 50% Price Surge for NAND Flash in Short-Term

(Photo credit: Samsung)

With the semiconductor market facing uncertainties and limited signs of industry recovery in the first half of 2024, foundries in China, Taiwan, and South Korea are all implementing price reductions to secure orders and solidify customer relationships.

According to TechNews citing from supply chain sources, Samsung Foundry, which had not taken action previously, is expected to follow suit with price cuts in the first quarter to keep pace with competitors.

Reportedly, industry sources suggest that Samsung Foundry is adopting a price reduction strategy in the first quarter of 2024, offering discounts ranging from 5% to 15% and expressing a willingness to negotiate.

Samsung Foundry’s actions can be interpreted as a goodwill gesture towards its customers. The company has been in constant competition with TSMC, especially in processes below 5nm, and actively engaging in negotiations with customers, seeking collaboration opportunities with Qualcomm, NVIDIA, AMD and others.

Considering the subdued semiconductor market in 2023, fabs in both China and South Korea have implemented price cuts to secure orders. The price reductions for mature processes in 8-inch and 12-inch wafer reached 20-30%, while Taiwanese fabs have also made concessions in pricing.

TSMC, the leading foundry, had already been reported to offer price concessions in 2023, with the major focus on mask costs rather than foundry services. It was mentioned at that time that TSMC’s price concessions primarily applied to the 7nm process, where utilization rates were lower, and the extent of concessions depended on the volume of orders from customers.

In terms of the global foundry landscape, according to data published by TrendForce, Taiwan holds approximately 46% of global foundry capacity, followed by China (26%), South Korea (12%), the US (6%), and Japan (2%).

However, due to government incentives and subsidies promoting local production in countries like China and the US, the semiconductor production capacities of Taiwan and South Korea are projected to decrease to 41% and 10%, respectively, by 2027.

Read more

• China and US Bolster Semiconductor Independence as Taiwan’s Foundry Capacity Share Projected to Decline to 41% by 2027, Says TrendForce
• [News] TSMC to Expedite Production of NVIDIA’s Specialized Chips for China

(Photo credit: Samsung)

In October of 2023, the U.S. government expanded its restrictions on chip exports, limiting NVIDIA from exporting certain chips to China without prior permission. Despite this, NVIDIA is not expected to relinquish the Chinese market and may commence production of the AI chip “H20,” specifically designed for China, in the second quarter of this year.

According to a report from Wccftech, there is keen interest in NVIDIA’s potential exclusive chips for China, including H20, L20, and L2, intended to replace H100, L40, and L4, catering to the AI training needs of Chinese customers.

NVIDIA is reportedly trying to accelerate its return to the Chinese AI chip market, expecting to quickly regain its advantage and market share. It is understood that the main base board supplier for the new product remains Wistron.

The orders from the relevant supply chain manufacturers’ clients will be deferred and are expected to see substantial shipments starting from the second quarter.

The report indicates that progress on these chip projects is steady, and the products fully comply with U.S. export restrictions. Production of the H20 is expected to commence in the second quarter.

Furthermore, it is reported that these GPUs were originally scheduled for release at the end of 2023 but faced delays due to the ongoing tensions between China and the US.

NVIDIA emphasized that the AI chip designed specifically for the Chinese market will fully comply with the requirements and guidelines of the U.S. Department of Commerce, subsequently enabling the launch of the GeForce RTX 4090D in China.

Industry sources estimate that NVIDIA is actively seeking to comply with U.S. government computing power regulations by further reducing the customized chip’s performance. However, due to missing a sales opportunity, many Chinese customers have begun exploring the purchase of local AI chips as an alternative to NVIDIA products.

This is primarily driven by the availability and competitive cost-effectiveness of Chinese chips, with several Chinese companies switching to Huawei products for AI training.

While NVIDIA has significantly streamlined the H20 to meet local demands in China, with computing power reduced to only 15% of the H100, the H20 still aims to strengthen its competitive advantage in specifications.

According to leaked specifications circulating online at the end of 2023, the H20 boasts a FP8 computing power of 296 TFLOPs and FP16 computing power of 148 TFLOPs, with an increased memory capacity of 96GB compared to the H100’s 80GB.

However, domestically-produced chips in China are also formidable. It is claimed that the performance of the H20 is only one-fourth that of Huawei’s HiSilicon Ascend 910B, yet its price is exceptionally high. Therefore, for some Chinese enterprises, there is still an incentive to adopt self-developed AI chips. In the future, whether the potential for domestically-produced AI chips in China can disrupt NVIDIA’s monopoly is yet to be seen.

Read more

• [News] NVIDIA’s China-Exclusive GeForce RTX 4090 D Rumored to be Launched on December 28th
• [News] TSMC to Expedite Production of NVIDIA’s Specialized Chips for China

(Photo credit: NVIDIA)

With its 3nm manufacturing process in mass production for approximately a year, TSMC is expected to have a breakthrough in customer acquisition and capacity utilization in 2024.

According to predictions from a South Korean outlet The Elec, aside from Apple, customers such as NVIDIA, AMD, Qualcomm, and MediaTek are expected to place orders for the second generation of the 3nm process within the year. This is anticipated to significantly boost TSMC’s 3nm process capacity utilization to 80% by the end of the year.

Chinese tech media ICsmart further quoted from the report, stating that although TSMC announced the mass production of its 3nm process in December 2022, the first-generation 3nm process (N3B) had only one customer throughout 2023, which was Apple. Companies like MediaTek and Qualcomm opted for the 4nm process due to cost considerations.

However, the report suggests that in 2024, more companies, in addition to Apple, are expected to place orders for the more cost-effective second generation of the 3nm process (N3E). This is anticipated to boost TSMC’s overall production capacity for the 3nm process.

Several chip companies are expected to adopt the N3E process for their new products. The report suggests that TSMC’s customers for this process may include Qualcomm, which is gearing up to launch the new Snapdragon 8 Gen 4, MediaTek with its next-generation Dimensity 9400, Apple with its M3 Ultra chip and A18 Pro processor, AMD with the Zen 5 CPU and RDNA 4 GPU, and NVIDIA with the Blackwell architecture GPU. Notably, the Apple M3 Ultra chip might make its debut in the upgraded Mac Studio around mid-year.

The report notes that TSMC initially anticipated steady growth for the 3nm process in early 2023 as yields improved, but with only Apple as a customer, the “steady growth” of the 3nm process negatively impacted TSMC’s performance.

The report suggests that with TSMC’s new orders from customers beyond Apple for the 3nm process, a considerable rebound is expected. Monthly production is projected to reach 100,000 wafers by 2024, and the 3nm production capacity utilization rate is poised to soar to 80% by the end of 2024.

Read more

• [News] Intel’s Next Gen CPU to Produce at TSMC with 3nm in First Half of Next Year
• [News] TSMC’s N3P to Enter Mass Production in the Second Half of Next Year, Rumored Inclusion of Tesla in Customer List

(Photo credit: TSMC)

In 2024, TSMC’s global expansion continues at full throttle, with industry reports suggesting a significant breakthrough in the establishment of a 3-nanometer advanced process manufacturing facility in Japan. Osaka is considered the most likely location for TSMC’s third plant in Japan.

TSMC has stated that it is actively evaluating suitable sites for construction and is not ruling out any possibilities.

According to Taiwan’s Commercial Times, following the announcement of Chairman Mark Liu’s retirement, speculation arises that President CC Wei will shoulder the responsibility of overseas expansion. With domestic 1.4 and 2-nanometer plans settled, and 3-nanometer production achieving high yields, developments in the U.S., Japan, Germany, and elsewhere are progressing rapidly.

Furthermore, sources in the supply chain reveal that TSMC has design centers in Osaka and Yokohama, making Osaka the front-runner for TSMC’s third plant in Japan.

Market speculations suggest that Japan will be a focal point for TSMC’s overseas expansion, with advanced processes and packaging potentially making significant strides in the country. Supply chain insiders point out that TSMC’s two R&D centers in Japan specializing in advanced process research and supporting design services for Japanese IDM customers. The advantageous conditions in Osaka are seen as superior to those in Yokohama.

TSMC’s subsidiary, Japan Advanced Semiconductor Manufacturing (JASM), is constructing a factory in Kikuyo Town, Kumamoto Prefecture, Japan, set to open on February 24 and expected to commence mass production by the end of 2024.

The second factory in Kumamoto is also planned to start operations in April. As for TSMC’s Taiwan facilities in advanced processes, the estimation is for 2-nanometer production to begin in Baoshan and Kaohsiung, gradually reaching mass production by 2026.

(Image: TSMC)