Even Nvidia Can't Secure Supply... A Counterattack Opportunity for the 'Second Player' Samsung

Samsung Electronics Raises Expectations as 2-Nanometer Process Yield Improves

There is analysis suggesting that TSMC, the world's largest foundry (semiconductor contract manufacturing) company, has reached the limits of its order volume due to the explosive surge in demand for artificial intelligence (AI) chips.

According to industry sources and local Taiwanese media on March 28, TSMC is reportedly fully booked with orders until 2028 due to the recent spike in demand for AI semiconductors. Global big tech companies have long collaborated with TSMC for semiconductor production, but TSMC's production capacity has now reached its limit. Although TSMC has steadily increased its foundry prices in line with strong demand, it remains difficult to secure additional production lines, making it inevitable that many companies will face significant disruptions. As a result, there is speculation that, starting this year, big tech companies may increasingly place orders with Samsung Electronics.

TSMC is currently building factories across the world, including in the United States and Japan. However, it is struggling to meet the explosive demand from big tech firms. In particular, production capacity for the 2-nanometer process, which is essential for AI semiconductors, is extremely limited. The Economic Daily News reported that "production capacity for the 2-nanometer process has reached a seriously insufficient level" and that "even major client Nvidia may not be able to receive sufficient quantities." The fourth plant in Arizona, USA, which is targeting mass production by 2030, has not even broken ground yet, but reservations are already fully booked.

Industry observers note that TSMC's production capacity has hit its limit, and as big tech companies pursue strategies to reduce dependence on a single foundry, Samsung Electronics is emerging as an alternative supplier. Samsung Electronics, which previously struggled to win big tech orders due to issues such as low yield rates (proportion of good chips), has recently raised its yield rate to a considerable level. Generally, a yield rate above 60% is considered sufficient for stable mass production, and it is reported that Samsung Electronics' 2-nanometer process yield has recently surpassed 60%. Currently, TSMC and Samsung Electronics are the only foundry companies capable of advanced processes like 2-nanometer technology.

Samsung Electronics is expected to target big tech clients using its Taylor, Texas plant in the United States, which is scheduled to begin operations at the end of this year, as a production base. Following order wins from Tesla and Apple last year, Samsung Electronics is anticipated to expand cooperation with other major tech companies as well. However, some point out that the priority for Samsung Electronics is to stably produce the existing orders and prove its yield and process stability.

This content was produced with the assistance of AI translation services.