Though still be struggling with low yield rates in 3nm, Samsung is reportedly ramping up its efforts to prepare for the mass production of 2nm and 1.4nm to compete with its longtime rival, TSMC. Citing industrial sources on Oct. 3^rd, Business Korea reveals that the South Korean foundry giant is introducing equipment at the Hwaseong plant to establish a 2nm production line, while it also plans to set up a 1.4nm line in its Pyeongtaek 2 plant next year.

According to the report, this initiative is in line with Samsung’s goal to mass produce 2nm in 2025 and 1.4nm by 2027.

In terms of the capacity expansion of 2nm, Samsung aims to install a capacity of 7,000 wafers per month by the first quarter of next year in its S3 foundry line at Hwaseong, Business Korea states. It is worth noting that the existing 3nm line at S3 is expected to be fully converted to a 2nm line by the end of next year.

Then, starting in the second quarter of next year, Samsung plans to set up a 1.4nm production line at the S5 facility in its Pyeongtaek 2 plant, with a capacity of approximately 2,000 to 3,000 wafers per month, according to the report.

Unlike the aggressive expansion for its advanced nodes in South Korea, Samsung’s foundry project in Taylor, Texas, seems to be in stagnant. The company had reportedly planned to begin mass production of below-4nm nodes there by the end of 2024, but this has somehow been pushed back to 2026, which reflects the possible yield issues regarding 3nm node with GAA architecture Samsung has been eager to solve, the report suggests.

Due to a decline in client orders, Samsung’s management has decided to convert the foundry line at its Pyeongtaek 4 plant into DRAM facilities, the report points out. Additionally, the Pyeongtaek 3 plant, which features a 4nm line, has decreased its scale of operation for the same reason.

Analysts cited by the report estimate that Samsung Foundry might incur a deficit of several hundred billion won in the third quarter of this year, underscoring the financial pressures the company is experiencing.

As the delay of the 3nm Exynos seems to be irreversible, securing the success of 2nm has become a top priority for Samsung. Business Korea indicates that the testing of Samsung’s 2nm will be conducted on the next-generation Exynos chip, codenamed “Tethys.” Evaluations may also be said to extend to chips from Qualcomm, Japan’s Preferred Networks (PFN), and Ambarella.

Read more

• [News] Samsung Reportedly Suspends Construction and Contract Plans for Pyeongtaek P4 and Taylor Plant 2
• [News] Samsung Reportedly Buckling Under Pressure, with Plans to Cut Overseas Workforce by Up to 30%

(Photo credit: Samsung)

According to The Register, Fujitsu and Supermicro are teaming up to develop a new platform featuring Fujitsu’s upcoming high-performance, Arm-based MONAKA processor and advanced liquid cooling systems.

On October 3, Fujitsu and Supermicro announced a long-term partnership to develop and market a platform using the FUJITSU-MONAKA processor, which is designed for high performance and energy efficiency and set to launch in 2027. The companies will also collaborate on liquid-cooled systems for high-performance computing (HPC), generative AI, and eco-friendly data centers.

The Register highlights two key aspects of the alliance: Arm chips generally run cooler than competitors, requiring less thermal management innovation, and Fujitsu had largely exited this server market two years ago.

The Register reported that in February 2022, Fujitsu announced it would stop manufacturing and selling mainframe systems by 2030 and phase out Unix servers by the end of 2029. However, a year later, Fujitsu unveiled MONAKA, the successor to its A64FX chip, as a more energy-efficient, high-performance solution for HPC, AI, and data analytics workloads.

According to the companies, FUJITSU-MONAKA is based on the Arm architecture and employs cutting-edge 2-nanometer technology, with a 2027 release planned.

The partnership will combine Supermicro’s “Building Block” modular design, which allows customers to choose components optimized for their specific workloads, including cooling options like air-conditioned, free air cooled, or liquid cooling.

Fujitsu’s subsidiary, Fsas Technologies, will provide global generative AI solutions that integrate Supermicro’s GPU servers and support services for data centers and enterprises. Fsas was spun off last December to handle Fujitsu’s PC, server, and storage business, excluding mainframe and Unix systems.

The Register also mentioned that while liquid cooling for Arm systems is not common, it’s not unprecedented. For example, Fujitsu’s Fugaku supercomputer uses liquid cooling for its A64FX processors. This focus on liquid-cooled systems targets the growing demand for machines handling higher AI and HPC workloads.

(Photo credit: Supermicro)

U.S. Services PMI (NMI) continued to expand in September, according to data released by the Institute for Supply Management (ISM) on October 3. The NMI rose from 51.5 in August to 54.9 in September, reaching its highest level since February 2023.

Breaking down the sub-indices, the Business Activity Index increased from 53.3 last month to 59.9, while the New Orders Index climbed from 53.0 to 59.4. Both indices have expanded for the third consecutive month, with gains exceeding 6%, driving the overall increase in the NMI and signaling that demand for U.S. services remains robust.

However, the Employment and Supplier Deliveries indices showed mixed performance. The Employment Index fell from 50.2 last month to 48.1, ending two consecutive months of expansion and returning to contraction territory. Surveyed firms reported difficulties in hiring new workers, resulting in slower employee growth, while job vacancies and layoffs remained largely unchanged, aligning with recent signs of a slowing labor market.

On the other hand, the Supplier Deliveries Index rose from 49.6 to 52.1, indicating that stronger business activity and rising orders have caused suppliers to slow their delivery times.

In other indices, the Prices Index rose from 57.3 last month to 59.4, reflecting strong demand, marking the 88th consecutive month of expansion. Meanwhile, the Inventories Index increased from 52.9 to 59.1, suggesting that businesses are stocking up in anticipation of the upcoming holiday season and in response to recent port labor strikes.

Overall, the September NMI data indicate that U.S. consumer demand remains strong. The report notes that the NMI corresponds to an annualized real GDP growth rate of 1.9%.

This contrasts sharply with the Manufacturing PMI data released the day before, which showed a reading of 47.2 for September, marking the sixth consecutive month of contraction. The gap between the two sectors’ PMI readings has widened to 7.7 points, the largest divergence since late 2019, underscoring the growing disparity in U.S. economic growth trends.

Read more at Datatrack

As TSMC has reportedly begun trial production of 2nm chips in its Baoshan Plant in Hsinchu, northern Taiwan, the schedule of mass producing 2nm in 2025 remains on track. A report by Commercial Times reveals that the price of 2nm wafers is expected to double compared to 4/5nm, which may exceed USD 30,000 per wafer.

While the yield rates for advanced nodes of Intel and Samsung are rumored to be relatively low, the rising price of 2nm wafers reflects TSMC’s market monopoly as well as its strong pricing power, the report notes.

Citing comments by sources from semiconductor companies, the report states that fabs have invested heavily in advanced processes. For instance, the R&D investment of 3nm may exceed USD 4 billion, with key partners in TSMC’s supply chain, such as Taiwanese IP providers and material suppliers, playing a critical role.

On the other hand, executives from IC design houses cited by the report reveal that even from the perspective of IC design, the R&D cost for advanced nodes remains high. For instance, the development cost for 28nm is approximately USD 50 million, while 16nm may require an investment of USD 100 million. For 5nm, the R&D cost has soared to USD 550 million, if the expenditure on IP licensing, software verification, and design architecture are factored in.

According to the report, foundries have invested even more, with research institutions estimating that R&D expenses for 3nm may range from USD 4 billion to USD 5 billion. Additionally, constructing a 3nm fab is expected to cost at least USD 15 billion to USD 20 billion. All these factors may lead to the high pricing of wafers in the advanced nodes.

Therefore, for a foundry, the development of a new-generation of node involves massive efforts, and needed to be supported by partners in three key sectors: equipment, software (including IP and EDA tools), and materials, the report notes. Once their products have been validated by the foundry, suppliers can usually secure long-term partnership.

With 2nm set to debut in 2025, TSMC’s key suppliers are expected to see explosive profit growth, the report indicates. According to the report, Taiwanese IP firm M31, for example, has already developed IP that supports the 2nm platform for both smartphones and high-performance computing. Likewise, eMemory has disclosed that it is collaborating with leading foundries to develop 2nm.

On the other hand, as 2nm processes require thinner wafers, Taiwan-based materials companies, such as Kinik and Phoenix Silicon International Corp., have entered the markets of diamond discs and reclaimed wafers.

According to the report, in terms of reclaimed wafers, the market value for 2nm is approximately 4.6 times that of 28nm. In addition, the number of dummy wafers will also increase in advanced processes, which benefit suppliers with more volume and higher average prices.

Read more

• [News] TSMC Reportedly Mulls to Offer Discounts on Mature Nodes, Particular for 7nm/14nm Orders
• [News] TSMC’s Newly Acquired AP8 Facility in Southern Taiwan Rumored to Start Production in 2H25

(Photo credit: TSMC)

Amkor and TSMC announced today that the two companies have signed a memorandum of understanding to collaborate and bring advanced packaging and test capabilities to Arizona, further expanding the region’s semiconductor ecosystem.

Amkor and TSMC have been closely collaborating to deliver high volume, leading-edge technologies for advanced packaging and testing of semiconductors to support critical markets such as high-performance computing and communications. Under the agreement, TSMC will contract turnkey advanced packaging and test services from Amkor in their planned facility in Peoria, Arizona. TSMC will leverage these services to support its customers, particularly those using TSMC’s advanced wafer fabrication facilities in Phoenix. The close collaboration and proximity of TSMC’s front-end fab and Amkor’s back-end facility will accelerate overall product cycle times.

The companies will jointly define the specific packaging technologies, such as TSMC’s Integrated Fan-Out (InFO) and Chip on Wafer on Substrate (CoWoS) that will be employed to address common customers’ needs.

The agreement underscores the shared commitment to supporting customer requirements for geographic flexibility in front-end and back-end manufacturing, as well as fostering the development of a vibrant and comprehensive semiconductor manufacturing ecosystem in the United States. The companies’ shared vision is to enable seamless technology alignment for customers across a global manufacturing network.

“Amkor is proud to collaborate with TSMC to provide seamless integration of silicon manufacturing and packaging processes through an efficient turnkey advanced packaging and test business model in the United States,” said Giel Rutten, Amkor’s president and chief executive officer.

“Our customers are increasingly depending on advanced packaging technologies for their breakthroughs in advanced mobile applications, artificial intelligence and high-performance computing, and TSMC is pleased to work side by side with a trusted longtime strategic partner in Amkor to support them with a more diverse manufacturing footprint,” said Dr. Kevin Zhang, TSMC’s Senior Vice President of Business Development and Global Sales, and Deputy Co-COO.“We look forward to close collaboration with Amkor at their Peoria facility to maximize the value of our fabs in Phoenix and provide more comprehensive services to our customers in the
United States.”

(Photo credit: Amkor)