Samsung Is Reportedly Contemplating Discounting Its 2nm Wafers To Gain An Edge Against TSMC, But Unstable Yields Still A Problem For 3nm GAA

Samsung and TSMC will reportedly commence mass production of their 2nm technology sometime in 2025. This means that the Korean giant’s foundry will match its Taiwanese competitor’s pace, but to gain that extra edge, a report claims that Samsung is contemplating offering potential customers a discount to take the market share away from its rival. While the company’s ambitions should be commended, the report also highlights that low yields remain Samsung’s Achilles’ heel, particularly with the 3nm GAA process.

Low yields are what likely caused Samsung to lose orders from Qualcomm, but a discount for the 2nm technology might change its mind

Samsung has taken the lead against TSMC in adopting the gate-all-around architecture (GAA) to its 3nm process, with TrendForce reporting that the Korean giant aims to overtake TSMC in the 2nm race after one or two years of adjustments. Though the price of each 2nm wafer has not been mentioned in the report, Samsung is considering offering discounts to take away TSMC’s unrivaled grip, but other problems stand in the foundry’s way of reaching the top.

For instance, for 2024, Qualcomm is said to have given 3nm chip orders exclusively to TSMC for its Snapdragon 8 Gen 4, a chipset that it said to be the company’s first to feature custom-designed Oryon cores. This is a major blow to Samsung as the company has, once again, lost an opportunity to secure a lucrative customer. An earlier report stated that the company’s 3nm GAA process continues to face yield issues and that to actually start making clients like Qualcomm interested in this technology, Samsung would have to raise those yields to 70 percent.

From the look of things, Samsung is not there yet, so its focus on the 2nm process might not be the right priority. Even if these wafers are offered at a discount, it will be of little benefit if Samsung’s yields do not improve. Qualcomm is also rumored to have delayed its dual-sourcing strategy to 2025, where it is expected to place orders with both Samsung and TSMC to gain a pricing advantage. The San Diego will have little choice but to adopt this approach as cutting-edge wafers are slowly creeping up in manufacturing cost.

Of course, Samsung has not completely decided on its 2nm wafer strategy, so if it can improve yields of 3nm GAA and its next-generation node, it can match TSMC’s pricing too. It is unlikely that Apple will switch to Samsung, but since other companies cannot take the financial undertaking that Apple can, they can change their path and look for ways to save on manufacturing costs, which is something Samsung may entertain in the future.

News Source: TrendForce

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