According to a report from the Financial Times, SoftBank Group has decided to move away from its plan to collaborate with Intel on producing AI chips to compete with NVIDIA and is now reportedly focusing on discussions with TSMC.

The same report, citing sources, reported that the partnership between SoftBank and Intel fell through because Intel struggled to meet SoftBank’s requirements. SoftBank reportedly attributed the collapsed talk to Intel’s inability to meet their demands for production volume and speed.

The report noted as well that this fallout occurred before Intel’s announcement of releasing its official announcement on its Q2 (April-June) earnings in early August. Notably, in response to a significant drop in its performance, Intel planned to lay off about 15,000 employees and suspend shareholder dividends.

Moreover, the report further cited rumors claiming that SoftBank has shifted its focus to discussions with TSMC; however, no agreement has been reached so far.

Reportedly, Intel, SoftBank and TSMC have all declined to comment on the situation.

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(Photo credit: Intel)

Google has accelerate its pace on the Pixel series, as the tech giant launched Google Pixel 9 on August 13th, which is two months ahead of its schedule.

Though the Tensor G4 processor in the model is manufactured with Samsung’s 4nm, according to a report citing sources by Commercial Times, Google is said to be switching to TSMC’s 3nm process with its next-generation Tensor G5, coupling with the foundry giant’s InFO-POP packaging.

Google’s Pixel 8 is said to be the first AI-centric smartphone, featuring a range of AI functionalities. Yet, Commercial Times’ report has indicated that, after years of close collaboration, Google will part ways with Samsung and have TSMC produce the Tensor G5 chip.

The chip is also said to adopt TSMC’s advanced InFO-POP packaging. Google’s move, according to the report, demonstrates its ambition to expand its leadership in software to hardware, as it eyes for the opportunities of edge AI.

Industry sources cited by the report further point out that in the fourth quarter, both Qualcomm and MediaTek will launch flagship-level chips, while Apple’s A18 will also be produced using TSMC’s N3 process.

All these developments have hinted at tech giants’ ambition on the massive potential of the edge AI market. Now, Google would be the latest competitor to join the race.

Meanwhile, though Pixel’s market share is relatively low, the Android ecosystem, with its 70% market share in smartphones and billions of users, offers significant potential. Google is said to be following a path similar to Apple’s, achieving complete integration of hardware and software to maximize this potential.

Google’s self-developed chip extends beyond mobile devices, with its TPU (Tensor Processing Unit) now in their seventh generation. Additionally, Google’s Arm-based CPUs are being developed in partnership with TSMC.

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(Photo credit: Google)

At its earnings call on August 14th, Taiwanese tech giant Foxconn addressed the progress of the highly anticipated launch of NVIDIA’s next-generation AI server, the GB200.

According to a report by Commercial Times, Foxconn confirmed that the development of the server cabinets is on schedule, and the company will be among the first suppliers to deliver, with shipments expected to begin in the fourth quarter. The company also expects significant growth throughout the year, driven by strong demand for AI servers.

Addressing concerns about the progress of its AI server business, Foxconn spokesperson James Wu stated that driven by strong customer demand, the company’s AI server revenue grew by more than 60% quarter-over-quarter in Q2, accounting for over 40% of its total server revenue.

Wu reaffirmed that the robust demand for AI servers is expected to continue, and the company maintains its forecast that AI servers will contribute 40% of its total server revenue for the year.

Additionally, Foxconn has observed strong demand from various types of customers for the new generation of AI cabinet solutions, which is expected to significantly contribute to its server revenue in 2025.

Previously, per a report from The Information, NVIDIA’s GB200 is said to be experiencing yield issues, leading to a one-quarter delay in mass shipments. When asked about potential delays in the shipment of GB200 AI servers, Wu responded that the development timeline for the GB200 cabinets is on schedule.

In the second quarter, Foxconn reported revenue of NTD 1.55 trillion (roughly USD 48 billion), with a gross margin of 6.37% and earnings per share (EPS) of NTD 2.53.

For the first half of the year, its revenue reached NTD 2.87 trillion (roughly USD 88.9 billion), marking a 4% year-over-year increase. Gross margin, operating margin, and net profit margin were 6.37%, 2.83%, and 1.98%, respectively, all showing improvements compared to the same period last year, which stood at 6.21%, 2.58%, and 1.66%.

Cumulative EPS for the first half was NTD 4.12. Looking ahead to the third quarter, Foxconn expects operations to gain momentum as they enter the traditional peak season, with both quarter-over-quarter and year-over-year growth anticipated.

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(Photo credit: Foxconn)

According to a report from TechNews, in response to the temporary power outage caused by a severe thunderstorm on the afternoon of August 13th, memory manufacturer Nanya Technology announced on the evening of August 14th that the outage led to a halt in some machinery operations.

As emergency measures and safety checks were immediately implemented, all of Nanya Technology’s employees are safe, and the company is working to restore operations, which are expected to resume within 2-3 days.

Still, the power outage had led to damage to wafers, equipment repairs, and production interruptions, with an estimated loss of NTD 300-500 million (roughly USD 9.3 – 15.5 million). The exact figure will be confirmed after further assessment.

On the day of the power outage on August 13th, TechNews already reported that Nanya Technology’s plant experienced a 20-minute power outage during the incident. The uninterruptible power supply (UPS) was activated, minimizing damage in the photolithography and etching areas. However, sites without UPS are still being assessed for potential impacts.

On the other hand, memory giant Micron only experienced a voltage sag and reported no significant issues. Micron further stated that the voltage sag at its Taiwan facility due to the August 13th incident did not cause any harm to employees, and operations remain normal.

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(Photo credit: Nanya Technology)

Recently, the Financial Times reported that despite over USD 400 billion in tax incentives, loans, and subsidies provided by the U.S. under the Inflation Reduction Act and the CHIPS and Science Act to boost local clean energy technology and semiconductor industries, the resurgence of U.S. manufacturing has been delayed as investors hit pause on their plans.

Reportedly, there are 114 major projects tied to these acts, totaling USD 227.9 billion in investments. However, projects with a combined investment of approximately USD 84 billion have faced delays ranging from two months to several years, with some even indefinitely postponed. These delays include several semiconductor projects.

Companies involved have cited worsening market conditions, slowing demand, and uncertainties in domestic policies as reasons for altering their investment plans.

• TSMC Delays Production at Arizona Facility

On August 13, TSMC announced several board resolutions, including the approval of a nearly USD 29,6 billion capital budget. Among these, TSMC approved up to USD 7.5 billion in funding for its wholly-owned subsidiary, TSMC Arizona.

TSMC had initially planned to build three fabs in Arizona over the next few years, with a total investment of USD 65 billion. However, per a recent New York Times report, despite four years having passed since the announcement, the Arizona plant has yet to produce a single chip.

According to a report from WeChat account DRAMeXchange, cultural differences and competition for labor resources with Intel are among the factors contributing to the challenges faced by TSMC’s Arizona facility, leading to production delays.

When TSMC announced plans to build a semiconductor fab in Arizona in May 2020, the initial plan was to start construction in 2021, with production slated to begin in 2024. The second fab was announced in December 2020, with a production target of 2026.

In May of this year, TSMC’s website indicated that the first Arizona fab’s production start has been postponed to the first half of 2025, while the second fab’s production has been delayed to 2028.

As for the third fab, TSMC has not yet disclosed the start date for construction, but the official plan is to commence production by the late 2030s.

According to TSMC’s plan, the first Arizona fab will use 4nm process technology, the second fab will employ 2nm technology, and the third fab will utilize 2nm or more advanced process technologies.

• Intel Delays Construction of Ohio Project

Intel, the U.S. semiconductor manufacturer, plans to invest USD 100 billion over the next five years in new fabs and expansions across Arizona, New Mexico, Ohio, and Oregon, creating 10,000 manufacturing jobs and 20,000 construction jobs.

Yet, according to a previous report by The Wall Street Journal in February, Intel has delayed its USD 20 billion chip project in Ohio due to market downturns and delays in U.S. subsidies.

Intel is set to build two new advanced fabs in Ohio, with an initial plan to begin chip manufacturing in 2025. Following adjustments, the completion of Intel’s Fab1 and Fab2 projects in Ohio has been postponed to 2026–2027, with operations expected to commence around 2027–2028.

As chip manufacturing processes advance to 3nm and 2nm, the investment required for fabs has surged, putting semiconductor companies under financial pressure. Against this backdrop, Intel has not only delayed the construction of its Ohio facility but has also made adjustments to its European projects.

Intel’s planned EUR 30 billion investment in two fabs, Fab 29.1 and Fab 29.2, in Magdeburg, Germany, was initially set to start in the second half of 2023.

However, due to delays in confirming EU subsidies and the need to remove topsoil at the construction site, Intel has postponed the start date to May 2025. Additionally, Intel has also paused its investment plans for facilities in France and Italy.

• Samsung Delays Taylor Fab Project

Initially, Samsung planned to build a semiconductor cluster in Taylor, Texas, including two advanced logic fabs and one advanced packaging facility, with up to USD 6.4 billion in U.S. subsidies.

The first of these fabs in Taylor began construction in 2022, initially scheduled to start production in 2024 with 4nm process capabilities. However, the plant may not begin operations until 2026, US local media MySA noted. This delay is likely due to a slowdown in the foundry market and delays in the disbursement of U.S. subsidies.

Meanwhile, according to reports from Tom’s Hardware and the Korean media outlet ETnews, with the delay in the construction of the semiconductor plant, Samsung may upgrade the facility’s advanced process technology from 4nm to 2nm.

This adjustment aims to enhance Samsung’s competitive edge in advanced process, positioning it more effectively against rivals like TSMC, Intel, and Rapidus.

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(Photo credit: TSMC)