According to a report from Bloomberg, Jun Young-hyun, head of Samsung’s chip business, recently sent a stern warning to employees about the need to reform the company’s culture to avoid falling into a vicious cycle.

Jun stated that the recent improvement in Samsung’s performance was due to a rebound in the memory market. To sustain this progress, Samsung must take measures to eliminate communication barriers between departments and stop concealing or avoiding problems.

Earlier this week, Samsung announced its Q2 earnings, showcasing the fastest net profit growth since 2010. However, Jun Young-hyun highlighted several issues which may undermine Samsung’s long-term competitiveness.

He emphasized the need to rebuild the semiconductor division’s culture of vigorous debate, warning that relying solely on market recovery without restoring fundamental competitiveness would lead to a vicious cycle and repeating past mistakes.

Samsung is still striving to close the gap with its competitors. The company is working to improve the maturity of its 2nm process to meet the high-performance, low-power demands of advanced processes. Samsung’s the first-generation 3nm GAA process has achieved yield maturity and is set for mass production in the second half of the year.

In memory, Samsung is beginning to narrow the gap with SK Hynix in high-bandwidth memory (HBM). According to Bloomberg, Samsung has received certification for HBM3 chips from NVIDIA and expects to gain certification for the next-generation HBM3e within two to four months.

Jun emphasized that although Samsung is in a challenging situation, he is confident that with accumulated experience and technology, the company can quickly regain its competitive edge.

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(Photo credit: Samsung)

According to a report by the Commercial Times, while TSMC, the global foundry leader, has established a plant in Kikuyo, Kumamoto City, Kyushu. ASE Technology Holdings (ASE), a giant in packaging industry, is setting up a plant in Kitakyushu as well. With these developments, Japan’s semiconductor production could potentially integrate both front-end and back-end processes, forming a cluster within Kyushu.

This development could lead to a revival of Kyushu’s semiconductor industry, once known as the “Silicon Island” in Japan, attracting more semiconductor supply chain companies to the region.

The report further notes that related equipment and inspection company, including MA-tek, semiconductor transmission and storage solutions provider Gudeng Precision, and semiconductor material distributor Topco Technologies Corp. (Topco) have all established bases in Kumamoto.

MA-tek, a leader in semiconductor inspection and analysis services, established its first Japanese laboratory in 2019 and a second one in Kumamoto in 2023. Since their establishment, these laboratories have consistently achieved growth rates higher than the company average.

With the rise of AI applications, many Japanese clients have AI chip development projects, leading to increased demand for MA-tek’s materials analysis (MA) and advanced process inspection services.

To capitalize on advanced process and packaging opportunities brought by AI, the company MAT has decided to increase its capital expenditure this year to between NTD 1.2 billion and NTD 1.4 billion.

These funds will be used to expand and upgrade the testing equipment and laboratory facilities in Nagoya and Kumamoto, and to establish a third laboratory in Hokkaido, which is expected to start contributing to revenue in Q1 2025.

On the other hand, Gudeng Precision is also planning to build a new plant in Kurume in Q2 this year, located between Fukuoka and Kumamoto, with a planned area of approximately 3,000 ping (about 10,000 square meters).

Gudeng Precision’s investment in Kurume, Japan, including equipment procurement, is estimated at about NTD 400 million to NTD 450 million. Construction is expected to begin by the end of this year, with production slated to start by the end of 2025.

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• [News] TSMC’s JASM Kumamoto Plant 2 Greenlit, Construction Expected to Commence by Year’s End
• [News] Kumamoto Vying for TSMC’s Third Fab, Looking to Build Semiconductor Hub

(Photo credit: JASM)

Intel not only reported earnings and forecasts that fell short of Wall Street expectations but also announced plans to cut more than 15% of its workforce, halt dividend payments for Q4 2024 (October-December), and reduce its full-year capital expenditure forecast by more than 20%.

According to Intel’s official announcement, its Q2 (April-June) earnings: adjusted earnings per share were $0.02, far below the analyst estimate of $0.10; revenue decreased by 1% year-over-year to USD 12.83 billion, missing the market expectation of USD 12.94 billion; and adjusted gross margin was 35.4%

During Q2, Intel’s Client Computing Group, responsible for producing PC processors, saw its revenue increase by 9% year-over-year to USD 7.41 billion, meeting the market expectation of USD 7.42 billion. However, the revenue from the Data Center and AI Group fell by 3% year-over-year to USD 3.05 billion, missing the market expectation of USD 3.14 billion.

Intel stated that sales of PC chips capable of handling AI tasks exceeded internalAI expectations, with shipments expected to surpass 40 million units in 2024.

Looking ahead to Q3, Intel forecasts revenue between USD 12.5 billion and USD 13.5 billion and an adjusted loss per share of $0.03. According to a report from Reuters citing an LSEG survey, analysts had originally predicted Q3 revenue to reach USD 14.35 billion with an adjusted earnings per share of $0.31. Intel’s adjusted gross margin for the quarter is expected to be 38%.

Intel CEO Pat Gelsinger stated that the latest layoff plan will affect about 15,000 employees. This is the largest single layoff action tracked by tech layoff monitoring site Layoffs.fyi since it began operations in March 2020. Intel currently employs around 110,000 people, meaning over 15% of its workforce will be impacted.

Gelsinger further pointed out that Intel must align its cost structure with the latest operational model and fundamentally change the way the company operates. He indicated that Intel’s revenue growth has not met expectations and has not yet benefited from powerful trends such as AI.

According to Intel’s statement, Intel will suspend dividend payments starting in Q4 until cash flow improves significantly. Since 1992, Intel has consistently paid dividends without interruption.

Intel has also decided to reduce its total capital expenditure budget for new plants and equipment in 2024 by over 20% to between USD 25 billion and USD 27 billion. The estimated total capital expenditure for 2025 will be between USD 20 billion and USD 23 billion.

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• [News] Intel Hires Micron Executive to Lead Its Foundry Business
• [News] Intel Suspended Investment in French and Italian Chip Plants

(Photo credit: Intel)

According to a report from Commercial Times, after suffering a multi-billion-dollar loss in its foundry business, Intel has recruited Naga Chandrasekaran, a veteran responsible for process technology development at Micron, as its Chief Operating Officer.

Intel is reportedly facing setbacks in developing chip manufacturing. After experiencing a staggering USD 7 billion loss in its foundry business in 2023, the company incurred an additional USD 2.5 billion loss in the first quarter of this year.

Thus,to drive the growth of its foundry business, Intel has recruited Naga Chandrasekaran from Micron, who will oversee all of Intel’s manufacturing operations and report directly to CEO Pat Gelsinger.

Chandrasekaran’s appointment will take effect on August 12. He will oversee Intel Foundry’s global manufacturing operations and strategic planning, including assembly and test manufacturing, wafer fabrication, and supply chain management. Essentially, Chandrasekaran will be responsible for all of Intel’s manufacturing activities.

In the announcement of the employment, Intel CEO Pat Gelsinger noted, “Naga is a highly accomplished executive whose deep semiconductor manufacturing and technology development expertise will be a tremendous addition to our team.”

“As we continue to build a globally resilient semiconductor supply chain and create the world’s first systems foundry for the AI era, Naga’s leadership will help us to accelerate our progress and capitalize on the significant long-term growth opportunities ahead,”  Gelsinger said.

As per a report from tom’s hardware, Chandrasekaran has spent over 20 years at Micron, holding various management positions. Most recently, he led global technology development and engineering focused on scaling memory devices, advanced packaging, and emerging technology solutions. His extensive background encompasses process and equipment development, device technology, and mask technology.

He will replace Keyvan Esfarjani, who is set to retire at the end of the year. Esfarjani, who has served at Intel for nearly 30 years, will remain with the company to assist with the transition. He has made significant contributions to Intel’s global supply chain resilience and manufacturing operations.

On the other hand, in an attempt to narrow down the gap with TSMC, Intel is also said to be recruiting the foundry giant’s senior engineers for its foundry division, according to a report by Commercial Times.

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• [News] TSMC and Intel Boost Their 2025 Capital Spending to Lead in the AI Era
• [News] New Battleground for TSMC, Samsung & Intel in Panel-Level Packaging

(Photo credit: Intel)

According to a report from Commercial Times, TSMC’s advanced processes continue to experience strong demand, with major tech companies such as Apple, Qualcomm, NVIDIA, and AMD nearly fully booking TSMC’s 3nm capacity, while the order visibility extends into 2025.

As per the same report, the supply chain of the foundry giant’s 3nm process is also expected to continue the momentum, benefiting companies like Gudeng Precision Industrial (Gudeng), KINIK Company (KINIK), Solar Applied Materials Technology Corp (Solar Applied Materials), YEEDEX and GreenFiltec.

Industry sources cited by the same report indicate that TSMC’s wafer prices for advanced process are expected to see double-digit percentage increases by 2025. Chairman C.C. Wei recently mentioned that TSMC’s wafer pricing is strategic, as values regarding products may differ. The progress in pricing negotiations with customers is “so far so good,” and TSMC is confident about achieving a balance between price and capacity.

A report from Wccftech also suggested that Apple’s upcoming A18 Pro SoC and NVIDIA’s next-generation “Rubin” architecture will both use the 3nm process. Following the widespread adoption of TSMC’s 3nm process, the 3nm supply chain has attracted significant market attention, with expectations for operational boosts in the coming year.

In the semiconductor industry, per the sources cited by Commercial Times, Gudeng has captured about 70% of the market share for EUV POD. As EUV lithography has become a standard in advanced processes, TSMC has been adopting EUV technology starting from the 7nm process node and increasing its usage in later generations. The number of EUV layers used per wafer has been growing, which bodes well for Gudeng as it continues to benefit from this trend.

In the semiconductor sputtering target materials sector, TSMC has traditionally relied on products from international suppliers. However, with a push towards domestic equipment and consumables, Solar Applied Materials entered TSMC’s advanced 7nm process supply chain last year and has now also become a supplier for the 3nm process. Solar Applied Materials’ revenue from semiconductor targets was 4% last year and is expected to reach 10% this year, with a target of 20% by 2026, according to the report.

YEEDEX specializes in supplying components for the front-end processes, such as precision vaccum chucks for EUV equipment. As the industry moves to 3nm processes, wafer thinness increases, making precision vaccum chucks crucial for improving yield rates.

GreenFiltec specializes in extractable chemical filters and AMC Micro Pollution Control services. Through innovative material research and development for filters, GreenFiltec prevents invisible gas molecules from settling in the air. These filters are key consumables for cost control and yield improvement. In the domestic advanced process market, GreenFiltec has captured over 50% of the market share, and its operations are expected to benefit similarly next year, the report noted.

KINIK produces reclaimed wafers and diamond discs. Its high-spec diamond disc products have gained continuous and expanded adoption from major clients, achieving over 70% market share in the 3nm segment. The sources cited by Commercial Times expect that as major clients’ 3nm production capacity reaches full utilization, KINIK’s performance will significantly improve starting next year.

Read more

• [News] AMD Reportedly Eyes Mass Production in 2025 for Zen 6 Architecture with TSMC’s N3E Process
• [News] Apple Not Adopting TSMC 2nm for iPhone 17? A19 Pro Chip Rumored to Use N3P Process

(Photo credit: TSMC)