Rumors have been circulating regarding Samsung’s 3nm yield recently. The latest market speculation on June 25^th alleged that Samsung’s foundry plant encountered a defect impacting 2,500 lots in the 3nm second-generation process, reportedly leading to a loss of 1 trillion won (USD 720 million), according to the latest report by the Chosun Daily.

On June 26^th, the semiconductor giant denied the rumors of a major defect in the production of semiconductor wafers at its foundry division in South Korea. Market speculations emerged earlier, suggesting that all the affected wafers, which equal to 2,500 lots, had to be discarded, the report noted. The volume corresponds to roughly 65,000 12-inch equivalent wafers per month.

According to the Chosun Daily, Samsung claimed that the rumor of “discarding them (the affected wafers) all” circulating in the stock market are unfounded. The current status of the products from the affected production line is still under evaluation, the report said.

Citing industry insiders familiar with the matter, the Chosun Daily noted that the reported figures might be exaggerated, pointing out that Samsung’s 3nm production capacity is less than 60,000 wafers per month. Furthermore, there are numerous inspection processes in place throughout the production line, indicating that such a large-scale defect may be improbable.

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• [News] Samsung’s 3nm Yield Reportedly Below 20%, Struggling for Mass Production

(Photo credit: Samsung)

As China keeps reducing its reliance on the global semiconductor supply chain with strong support from the authority, two major smartphone manufacturers reportedly claim to have already taped out their own 4nm mobile processors. According to the reports by Liberty Times and Commercial Times, Xiaomi and Unisoc, by using foreign IP cores from ARM and IMG, have successfully taped out domestic 4nm chips.

According to the latest data from TrendForce, Xiaomi (including Xiaomi, Redmi, and Poco) has moved past last year’s high inventory issues, achieving a total production of 41.1 million units in the first quarter and ranking third globally in market share, only after Samsung and Apple. Oppo, Transsion and Vivo are the other three Chinese smartphone brands having made it to the top six regarding global shipments.

Shanghai-based fabless chip firm Unisoc, on the other hand, is specialized in areas including 2G/3G/4G/5G, Wi-Fi, Bluetooth, TV FM, satellite communications and other related technologies, according to its website.

Citing comments from Chinese tech blogger “Oneline Technology,” the reports point out that Xiaomi’s self-developed chip has made a significant leap forward, while the performance of its 4nm chip is similar to that of Huawei’s Kirin 9000s, and is expected to be seen this year. Huawei’s Kirin 9000s is reportedly manufactured by SMIC’s 7nm.

Citing another Chinese blogger, “Fixed Focus Digital,” the reports mention that Unisoc’s 4nm chip has already taped out, achieving performance levels comparable to Qualcomm’s Snapdragon 888.

Regarding the timeline for Chinese domestically produced smartphone SoCs to reach 4nm, the reports, citing industry insiders, state that it is more likely to happen in 2026. For now, MediaTek and Qualcomm still dominate Chinese’s smartphone chip market.

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• Q1 Smartphone Production Increases Due to Low Base Last Year, Expected to Decline 5–10% in Q2, Says TrendForce

(Photo credit: Unisoc)

According to a report by the Korean media outlet The Chosun Daily on June 16th, Samsung’s “Galaxy Tab S10” series tablets will be equipped with MediaTek’s Dimensity 9300+ application processor (AP) from Taiwan, marking the first instance of MediaTek’s AP being adopted by Samsung’s flagship tablet.

The report highlights that MediaTek’s APs have primarily been used in Samsung’s mid-to-low-end smartphones. The decision to use MediaTek’s AP in the Galaxy Tab S10 series, instead of Qualcomm’s or Samsung’s own APs, is a significant shift for Samsung.

The sources cited in the report believe that Samsung’s move is a butterfly effect caused by TSMC’s price hikes. TSMC’s price increases have potentially led to a rise in the cost of Qualcomm’s Snapdragon chips, which are manufactured by TSMC. After price negotiations, Samsung’s Mobile Communications Business (MX) decided to equip the Snapdragon 8 Gen 3 chips only in the Galaxy Tab S10 Ultra series, while using MediaTek’s Dimensity chips in the Plus and base models.

The same report further indicates that from Samsung’s perspective, choosing Dimensity to reduce costs and diversify the supply chain is a sensible decision. However, for Samsung’s foundry division which manufactures Exynos, this development is somehow unwelcome. While Exynos used to have price advantages over Snapdragon in supplying Samsung’s flagship products, the use of Dimensity jeopardizes Exynos’ competitive edge in its bargaining power for future flagship product pricing negotiations.

Samsung Electronics’ upcoming AP, the “Exynos 2500,” set for release next year, will also face similar challenges. With TSMC recently rumored to increase price for its 3nm process, costs for Qualcomm’s Snapdragon 8 Gen 4, slated for release in October, are expected to sharply increase. Industry source cited by the report further suggests the cost of this chip could rise from over USD 200 in the previous generation to more than USD 250.

TSMC Chairman C.C. Wei recently stated that, almost all companies interested in AI-related demand are willing to work with TSMC. From the yield rates obtained by customers, TSMC offers the best cost-effectiveness solutions, hence there is room for price increases. Per a report from Liberty Times, the wafer order prices for TSMC in 2025 are expected to be finalized in September and October this year.

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• [News] Samsung Reportedly to Challenge Apple/TSMC with 3nm Exynos W1000
• [News] MediaTek Announces 4nm Dimensity 7300 Series Chips, Supporting Foldable Devices

(Photo credit: MediaTek)

With the United States expected to further restrict China from acquiring advanced GAA (Gate-All-Around) chip architecture capabilities, coupled with reports of poor yield rates in Samsung’s 3nm GAA generation, the semiconductor industry sources cited in a report from Commercial Times state that TSMC’s 3nm FinFET process is enjoying dominance. Reportedly, due to the high demand and limited supply capacity, upstream IC design companies are beginning to report price hikes.

Seven global tech giants, including NVIDIA, AMD, Intel, Qualcomm, MediaTek, Apple, and Google, are set to gradually adopt TSMC’s 3nm process. As per the sources cited in the report from Commercial Times, Qualcomm’s Snapdragon 8 Gen 4, built using TSMC’s N3E process, has seen a price increase of 25% compared to the previous generation, potentially triggering a subsequent trend of price hikes.

Samsung was the first to commence mass production of 3nm chips using the GAA process in June 2022. However, the first-generation N3 node, SF3E, did not achieve significant success and was initially limited to cryptocurrency applications. Subsequently, the yield rate for its own Exynos 2500 chip also fell short of expectations.

Additionally, Google’s Tensor processors, which are manufactured by Samsung, still use Samsung’s 4nm process in their fourth generation. However, it is said in the report that the fifth generation will switch to TSMC’s 3nm process.

In the second half of the year, numerous AI products will be launched in the consumer market. Among the three major players in the mobile chip market, Qualcomm’s Snapdragon 8 Gen 4, MediaTek’s Dimensity 9400, and Apple’s A18 and M4 series will all be built using TSMC’s N3 family. Moreover, Google’s Tensor G5 will also compete in the market.

It is rumored that Qualcomm’s Snapdragon 8 Gen 4 has already initiated the first wave of price increases. The industry sources cited in the report claim that the procurement cost of mobile chips was already high, with last year’s flagship 8 Gen 3 costing around USD 200. This year’s flagship chip might exceed USD 250. Whether competitors will follow suit remains to be seen.

However, industry sources cited by the report also point out that the price increase is within a reasonable range. Compared to the 5nm process, the cost per wafer for the 3nm process is about 25% higher. This increase does not yet take into account overall wafer quantities and design architecture factors.

TSMC President C.C. Wei has also revealed that TSMC products are highly power-efficient and have better yield rates. When considering the cost per chip, TSMC is the most cost-effective.

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• [News] Major Clients Reportedly Fully Allocate TSMC’s Production Capacity Until 2026, 3nm Process in High Demand
• [News] NVIDIA CEO Jensen Huang Supports C.C. Wei’s Theory and Backs for TSMC to Increase Price

(Photo credit: TSMC)

MediaTek is making further strides in AI applications, focusing on the integration of smartphones and AR/MR devices. According to a report from the Economic Daily News, they look to capitalize on the significant business opportunities presented by 3D imaging combined with generative AI for immersive experiences. The sources cited in the same report indicated that MediaTek has formed an alliance with Meta, leveraging MediaTek’s Dimensity series smartphone chips as a platform alongside Meta’s Quest devices to target this market.

Previously, tech giants like Apple and Qualcomm have also recognized the potential of 3D imaging combined with generative AI for immersive experiences, and thus have been actively developing their strategies. While Apple builds its ecosystem through iPhones and Vision Pro headsets, Qualcomm has strengthened its collaboration with Google. With Meta and MediaTek entering the fray, the competition in the 3D imaging market will be further intensified.

Industry sources cited by the same report indicated that the generative AI business opportunity is set to explode, as cloud service providers (CSPs) are actively building AI servers, engaging in a “computing power war.” This hints that future AI market demand is likely to extend from the cloud to edge devices, thereby expanding AI applications to smartphones and AR/MR-related end-user devices.

Apple, which just showcased its upcoming products at WWDC, has launched the MR device Vision Pro previously, and is reportedly looking to expand its AI technology layout further. This includes integrating AI capabilities into iOS 18 in the iPhone 16 series, which will be released in September.

Meanwhile, per the same report, it’s expected that the iPhone 16 series will significantly enhance 3D photography features and improve integration with the Vision Pro. This indicates that 3D imaging will become a new application frontier in Apple’s AI strategy.

Non-Apple camps are also sensing these trends and opportunities. Qualcomm is reportedly teaming up with Google to integrate related systems in smartphones and wearable devices.

It is reported that Google has already strengthened its hardware development team in Taiwan. By doing so, the tech giant is possibly aiming to collaborate directly with major semiconductor companies like TSMC to develop 3D imaging applications. To bolster its future AI strategy, Qualcomm will collaborate with Google to integrate 3D imaging platforms into smartphones.

Industry sources cited by the report suggested that beyond language models, imaging is one of the AI applications that provide tangible experiences for users. Currently, AI applications in imaging are mostly focused on photo editing and cartoonization. However, with the improvement of camera functionalities in mobile devices, AI will begin to be integrated into 3D imaging.

As a result, major mobile platform providers will not only emphasize AI processing chips in their future hardware specifications but also upgrade imaging hardware specifications. This is expected to become a new battleground, potentially sparking a new wave of AI-driven smartphone upgrades.

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• [News] Four Semiconductor Applicants for Taiwan’s Chip Act Tax Incentives – TSMC and MediaTek Expected to Benefit
• [News] MediaTek Announces 4nm Dimensity 7300 Series Chips, Supporting Foldable Devices

(Photo credit: MediaTek)