Driven by AI-driven demand for optical communication and ASICs, Marvell, a major network IC design company, is accelerating its AI-related business. According to a report from Commercial Times, the revenue from this segment is expected to grow from USD 200 million in fiscal year 2023 to USD 550 million in fiscal year 2024.

Marvell previously announced plans to utilize TSMC’s process technology to produce a 2-nanometer chip optimized for accelerating infrastructure. Reports suggest that TSMC will be a primary beneficiary of Marvell’s chip fabrication business.

“The 2nm platform will enable Marvell to deliver highly differentiated analog, mixed-signal, and foundational IP to build accelerated infrastructure capable of delivering on the promise of AI. Our partnership with TSMC on our 5nm, 3nm and now 2nm platforms has been instrumental in helping Marvell expand the boundaries of what can be achieved in silicon,” said Sandeep Bharathi, chief development officer at Marvell, in Marvell’s previous press release.

In addition, Marvell holds a high market share in the global optical communication digital signal processor (DSP) field. Marvell pointed out that AI has accelerated the rate of transmission speed upgrades, reducing the doubling cycle from 4 years to 2 years, thereby driving rapid growth in the company’s performance.

During Marvell AI Day, company management expressed optimism about its AI business outlook and shared the positive news of receiving AI chip orders from large technology companies. At the time, industry sources have speculated that this customer could be Microsoft.

Marvell CEO Matt Murphy revealed that the company has acquired its third AI hyperscale customer and is developing an AI accelerator slated for production in 2026. These orders encompass customized AI training accelerators and AI inference accelerators for Customer A, a customized Arm architecture CPU for Customer B, and a new customized AI accelerator for Customer C.

Marvell indicates that the AI training accelerators for Customer A and the Arm architecture CPU for Customer B are currently in the ramp-up phase for production. The AI inference accelerator for Customer A and the AI accelerator for Customer C are scheduled for production in 2025 and 2026, respectively.

The report cites sources indicating that Marvell’s customer B is Google, and the Arm-based CPU in question is the recently unveiled Google Axion. However, Marvell has not responded to this information.

Marvell highlighted advancements in chip technology, including advanced packaging techniques that integrate multiple chips.

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• [News] The Imminent Arrival of 2-Nanometer Advanced Process
• [News]The 2nm Semiconductor Foundry Race Between TSMC, Samsung, Rapidus Begins with an Equipment Battle

(Photo credit: TSMC)

Amid the memory market’s gradual recovery, memory manufacturers are aggressively increasing prices back to pre-reduction levels and achieve profitability. According to a report from TechNews, however, module suppliers are reportedly resisting these price hikes and considering ways to negotiate with manufacturers, potentially through non-purchasing actions.

With the continued growth in demand for AI and high-performance computing, memory prices are on the rise. According to TrendForce, Kioxia and WDC have increased capacity utilization since Q1 2024, while others maintain low production strategies. Although NAND Flash procurement slightly decreased in the second quarter compared to the first quarter, the overall market sentiment continues to be influenced by reduced supplier inventory and production cut effects. As a result, NAND Flash contract prices for the second quarter are expected to see a strong increase of approximately 13-18%.

Apart from NAND Flash, in the realm of DRAM, although suppliers’ inventories have decreased, they have not yet returned to healthy levels. Moreover, in the context of improving losses, suppliers are increasing capacity utilization.

However, due to unfavorable overall demand prospects for 2024 and significant price hikes by suppliers since the fourth quarter of 2023, the momentum for inventory replenishment is expected to weaken gradually. Therefore, TrendForce predicts that the second-quarter contract price increase for DRAM will converge to 3% to 8%.

Despite the continuous rise in memory prices driven by applications in artificial intelligence and high-performance computing data centers, demand in the consumer market remains subdued. Manufacturers persist in strong pricing strategies, prompting backlash from module suppliers.

Additionally, it is reported that Micron is preparing to increase second-quarter quotes by over 25%, which is putting pressure on module suppliers and potentially leading to a standoff with manufacturers.

On the other hand, module suppliers are showing a lukewarm response to the price increases and are particularly hesitant to accept price increases themselves.

However, with the three major memory manufacturers facing constraints on adding new capacity in the short term, whether module suppliers will be forced to accept significant price increases remains to be seen.

Read more

• [News] Micron Expects 4-6% Quarterly DRAM Supply Impact Post Taiwan Earthquake
• [Insights] The Spot Price of DRAM Continues to Decline, Weak Trading Volume for NAND Flash

• With the Ongoing Expansion of Global EV Battery Market, China’s Dominant Position Steadily Strengthens

In recent years, the rapid growth of EV and energy storage markets has driven robust demand for lithium-ion batteries (LiBs). Data shows that in 2023, the total shipment of LiBs exceeded 1 terawatt-hour (TWh) for the first time, with the market size growing more than tenfold compared to 2015, and EV battery shipment accounted for over 70% of the general battery shipment.

As the electric vehicle and energy storage markets continue to grow, the demand for LiBs will enjoy further expansion, with global LiBs shipment expected to outstrip 3,200 GWh by 2027.

Despite the fact that LiB was initially commercialized in Japan in the 1990s and long dominated by Japanese and South Korean manufacturers, over two decades later, China has leapfrogged the two nations. Currently, over 75% of the world’s LiBs are produced in China, marking China’s top position in manufacturing LiB.

Likewise, in the EV battery sector, which accounts for the largest demand in the LiB market, six out of the top ten manufacturers globally are headquartered in China, including CATL, BYD, CALB, Gotion High-Tech, EVE Energy, and Sunwoda, which are expected to hold increasingly higher market shares while the market shares of Japanese and South Korean companies is declining year by year.

For instance, Panasonic’s market share in the EV battery market has dropped to around 6%, and the combined market share of South Korean manufacturers to approximately 23%.

However, with the advancement and breakthroughs in next-generation automotive battery technology—all-solid-state battery (ASSB) technology—the position of traditional liquid-state battery is being challenged.

• Next-Generation Battery Technology Comes to the Fore

On January 3, 2024, PowerCo, a battery subsidiary of Volkswagen, announced that its partner, QuantumScape, had successfully passed its first endurance test on solid-state batteries, achieving over 1,000 charge-discharge cycles while maintaining a capacity of over 95%.

Additionally, in September 2023, another solid-state battery listed company based in the US, Solid Power, announced that its first batch of A-1 solid-state battery samples had been officially delivered to BMW for automotive verification testing. BMW aims to launch its first prototype vehicle based on Solid Power’s solid-state battery technology by 2025.

Last year, Toyota has repeatedly stated its intention to commercialize solid-state battery technology by 2027-2028.

• Does All-Solid-State Battery (ASSB) Technology Truly has the Potential to Overturn Liquid-State Battery Technology?

Traditional liquid-state LiB is primarily composed of cathode and anode electrodes, separator, and electrolyte. The cathode and anode electrode materials play the role of storing lithium, which affects the battery’s energy density, while the electrolyte mainly influences the motion rate of lithium ion during charging and discharging processes, typically using liquid (Organic solvents) as the electrolyte.

However, during the charge-discharge process of traditional liquid-state LiB, side reactions can easily occur on the electrode surface. For example, lithium dendrites formed on the surface of the anode electrode can easily penetrate the separator, causing a short circuit between the cathode and anode electrodes and leading to battery fires.

In addition, the liquid electrolyte is a flammable substance, making liquid-state batteries prone to ignition and explosion under high temperatures or when the battery experiences external impacts that result in a short circuit. Therefore, liquid-state battery faces significant challenges in terms of safety.

Compared to liquid-state LiB, the electrolyte in ASSB is solid, which is less volatile or prone to combustion. Meanwhile, solid-state electrolytes are temperature-stable and less prone to decomposition, rendering them highly safe.

Furthermore, solid-state electrolytes exhibit better stability and mechanical properties, providing superior suppression of lithium dendrites and thereby enhancing battery safety.

On the other hand, traditional liquid-state LiB is limited in their choice of materials due to their narrow electrochemical window and side reactions between the liquid electrolyte and the cathode and anode electrode materials. Solid-state electrolytes, however, offer a wider electrochemical window and fewer side reactions, allowing for a broader range of electrode materials to be used in solid-state battery.

This enables the use of higher energy density active materials. For instance, solid-state battery based on lithium metal anodes can achieve energy densities of over 500 Wh/kg, while liquid-state LiBs can hardly reach this level, with a theoretical energy density limit of 350 Wh/kg. Currently, traditional liquid-state LiBs have approached their theoretical energy density limit, and there’s little room for further improvement.

On top of that, ASSB also boasts better temperature adaptability (-30 to 100°C) and high power characteristic, which can help improve the operating temperature range and fast-charging performance of EV battery.

Meanwhile, as there is no need for liquid electrolytes and separators, the weight of ASSB cells can be reduced. Additionally, processes such as electrolyte filling, degassing, molding, and aging can be removed during the cell assembly process, simplifying the cell manufacturing process. As a whole, given its outstanding performance, ASSB indeed holds the potential to revolutionize liquid-state LiB.

Currently, ASSB, in face of a series of technical challenges, has not yet achieved large-scale production. These challenges include the batch preparation of electrolyte materials, interface stability/side effects between solid materials, as well as the breakthrough of technical hurdles in cell preparation processes, production equipment, and other aspects.

Still, with significant attention and investment from countries worldwide, including Japan, South Korea, Europe, and the US, ASSB has made important progresses and is expected to achieve mass production within 3-5 years.

• Will China be Overtaken in the Market Competition of All-Solid-State Battery?

Currently, ASSB has emerged as the high ground in the competition for next-generation battery technology. The development of ASSB has been listed as a national development strategy by major countries and regions such as Japan, South Korea, the US, and the European Union, and global enterprises are actively making inroads in this field.

Based on different solid electrolyte technical routes, ASSB can be divided into four types: polymer, oxide, halide, and sulfide solid-state batteries. Each of these technology routes has its own advantages and disadvantages. Currently, Japan and South Korea mainly select sulfide as the primary technical route.

In light of the development progress of ASSB in major regions globally, Japan is an early starter in R&D, which takes a lead in the application of patents, and accumulates the most solid-state battery patented technologies worldwide. Japanese companies like Toyota and Nissan have stated their intention to achieve mass production of ASSB around 2028.

In South Korea, major battery manufacturers like Samsung SDI, SK Innovation, and LG Energy Solutions continue to invest in R&D. Samsung SDI completed the construction of a pilot production line (S-line) for ASSBs in 2023 and plans to achieve mass production in 2027.

In the United States, solid-state battery development is primarily led by startups with high innovation potential. Companies like QuantumScape and Solid Power have solid-state battery products in the A-sample stage, while SES’ lithium-metal solid-state batteries have entered the B-sample stage. Other US companies such as Ampcera, Factorial Energy, 24M Technologies, and Ionic Materials have channeled more efforts in solid-state battery technical innovation.

Overall, the period around 2028 is expected to be tipping point for the mass production of ASSB.

Although China is currently the world’s largest manufacturer of LiB, there is still a significant gap between Chinese companies and international ones in terms of patent layout for ASSB.

Additionally, China’s solid-state battery technical routes are diverse, with a focus mainly on semi-solid/state-liquid hybrids, with semi-solid-state battery achieving small-scale production and adoption in vehicles, but investment in ASSB remains insufficient in China, and resources are dispersed. This has led to a significant difference compared to international forerunners.

Therefore, in the future competition for ASSB, companies from Japan, South Korea, Europe, and the US have the opportunity to surpass China and reshape the competitive landscape of future EV battery industry.

Read more

• [News] The US Administration Rumored to Announce USD 7 Billion Grant for Samsung to Boost Chip Capacity
• [News] TSMC Receives USD 6.6 Billion for Chipmaking from the US Government, Commits to Constructing Third Fab

(Photo credit: Pixabay)

The Taiwanese semiconductor foundry Powerchip Semiconductor Manufacturing Corporation (PSMC) has held its earnings call and released its Q1 financial report. According to a report from Liberty Times Net citing information, with increasing capacity utilization, idle capacity costs decreased, boosting gross margin to 15.4%, up 12.3 percentage points from the previous year’s Q4. The net loss narrowed to NTD 439 million after tax, translating to a loss of NTD 0.11 per share.

Looking ahead to a potential turnaround this year, PSMC’s General Manager, Brian Shieh, highlighted that while large-size panel driver ICs are performing relatively well, Chinese foundries are exerting significant pricing pressure on mature processes, impacting average selling prices unfavorably. This remains a key variable affecting profitability.

In response to inflation-driven equipment cost adjustments and market demands, PSMC is revising its product portfolio. They also announced an increased capital expenditure of NTD 32 billion for 2024, which represents a 30% increase from the previously disclosed amount of NTD 24 billion. Powerchip’s Tainan fab has initiated trial production, with future investments focusing on power management IC, memory, and copper processes in the interposer.

Brian Shieh mentioned that PSMC’s capacity utilization rate was around 65% in the fourth quarter of last year. In the first quarter of this year, the utilization rate for logic products improved slightly, while memory product utilization reached 95% to 98%.

He expects memory product utilization to remain at first-quarter levels in the second quarter, with logic product utilization around 65% to 70%. Overall gross margin is anticipated to remain stable or improve compared to the first quarter.

According to TrendForce’s previous report on the fourth quarter of 2023, global semiconductor foundry revenue rankings showed that Intel Foundry Services (IFS), which ranked ninth globally in the third quarter of 2023, was pushed out of the top ten by PSMC and Nexchip due to factors such as the transition between old and new CPU generations and lackluster inventory momentum. At the same time, the top three semiconductor foundries globally were TSMC, Samsung, and GlobalFoundries.

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• [News] PSMC’s Frank Huang Explores Global Expansion through Fab IP, Diverging from TSMC’s Path
• [News] TSMC and PSMC Face Dilemma as Overseas Foundry Costs Skyrocket 2.5 to 4 Times

(Photo credit: PSMC)

The US government announced on April 15th that it will provide up to USD 6.4 billion in subsidies to South Korean semiconductor giant Samsung Electronics for expanding advanced chip production capacity at its Texas plant.

The US government previously approved subsidies of up to USD 8.5 billion for US chip giant Intel and USD 6.6 billion for TSMC to alleviate future semiconductor supply constraints. Semiconductors are currently considered the lifeblood of the global economy.

The Department of Commerce stated in a release, “…the U.S. Department of Commerce and Samsung Electronics (Samsung) have signed a non-binding preliminary memorandum of terms (PMT) to provide up to $6.4 billion in direct funding under the CHIPS and Science Act.”

The statement also mentioned that Samsung Electronics is expected to “invest more than $40 billion dollars in the region in the coming years, and the proposed investment would support the creation of over 20,000 jobs.”

US officials told reporters that this subsidy from the “Chips and Science Act” would assist Samsung Electronics in expanding chip production for use in aerospace, defense, and automotive industries, enhancing US national security.

Lael Brainard, the Director of the White House National Economic Council, emphasized that the resurgence of advanced chip manufacturing in the United States signifies a significant milestone for the domestic semiconductor industry.

US Commerce Secretary Gina Raimondo indicated that this subsidy would support two chip production facilities, one R&D fab, and one advanced packaging facility. She mentioned that this subsidy would also help Samsung expand its semiconductor facility in Austin, Texas.

Raimondo further stated, “…this proposed funding advances America’s leadership in semiconductor manufacturing on the world stage.”

Previously, the U.S. government announced that Intel would receive USD 8.5 billion in federal subsidies and USD 11 billion in loans. Intel is planning to invest USD 100 billion across four states in the U.S. for building and expanding fabs, and is also seeking an additional USD 25 billion in tax credits.

On the other hand, US administration is set to provide USD 6.6 billion in aid to TSMC, which plans to build a third chip plant in Arizona with a total investment of USD 65 billion.

Read more

• [News] The US Administration Rumored to Announce USD 7 Billion Grant for Samsung to Boost Chip Capacity
• [News] TSMC Receives USD 6.6 Billion for Chipmaking from the US Government, Commits to Constructing Third Fab