Friday, March 10th 2023
TSMC's 3 nm Node at Near 50 Percent Utilisation, Other Nodes Seeing Lower Demand
Based on multiple reports out of Taiwan, TSMC is seeing increased utilisation of its 3 nm node and its production line is now at close to 50 percent utilisation. The main customer here is without a doubt Apple and TSMC is churning out some 50-55,000 wafers a month on its 3 nm node. TSMC is also getting ready to start production on its N3E node later this year, which will see some customers move to the node.
However, it's not all good news, as TSMC is seeing a decline in utilisation on its 5/4 and 7/6 nm nodes as demand has dropped significantly here, with different news outlets reporting different figures. Some are suggesting the 7/6 nm nodes might have dropped as low as to 50 percent utilisation, others mention 70 percent. The 5/4 nm nodes aren't anywhere nearly as badly affected and remain at around 80 percent utilisation. The good news for TSMC is that this is expected to be a temporary slump in demand and most of its leading edge nodes should be back at somewhere around a 90 percent utilisation rate by the second half of the year. However, this depends on what the demand for its partners' products will look like going forward, as many of TSMC's customers are seeing lower demand for their products in turn.
Sources:
Digitimes, Commercial Times, via @dnystedt (on Twitter)
However, it's not all good news, as TSMC is seeing a decline in utilisation on its 5/4 and 7/6 nm nodes as demand has dropped significantly here, with different news outlets reporting different figures. Some are suggesting the 7/6 nm nodes might have dropped as low as to 50 percent utilisation, others mention 70 percent. The 5/4 nm nodes aren't anywhere nearly as badly affected and remain at around 80 percent utilisation. The good news for TSMC is that this is expected to be a temporary slump in demand and most of its leading edge nodes should be back at somewhere around a 90 percent utilisation rate by the second half of the year. However, this depends on what the demand for its partners' products will look like going forward, as many of TSMC's customers are seeing lower demand for their products in turn.
41 Comments on TSMC's 3 nm Node at Near 50 Percent Utilisation, Other Nodes Seeing Lower Demand
The only ones doing well are the older nodes that cater to industrial and automotive electronics, like UMC.
The trade ban imposed on the entire industry is seriously hurting the bottom line.
the economic crash of 2008 ruined the move to 450mm (18inch) wafers, I wonder what the current mess will ruin
www.semianalysis.com/p/tsmcs-3nm-conundrum-does-it-even
You do have a choice though.. buy, or do not buy..
Take negatives and turn them into positives.
Carrots, celery, all the healthy stuff is still dirt cheap and didn't raise in price. Speaking of which time to go eat some peanut butter celery now and possibly an orange as my dessert, ice cream ain't got shit on a good orange.
Looks like TSMC isn't getting the message.
I suspect in 5 years TSMC should collapse or turn to UMC levels. Industry will not allow to repeat the hostage situation again. The gears are already moving towards it. The final blow should be Apple/US policy to manufactured in mainland only and then bye bye.
The bigger trend is that vast majority of the public upgraded their devices in 2020-2021 during lockdowns and they are still working properly with no need for an upgrade in 2023. Combined with higher interest rates making financing new purchases less attractive, you have a slump in the market that is reducing demand for chips regardless of the price.
I highly suspect that TSMC has done the math and found that leaving some of their capacity idle results in fewer losses than dropping prices. Keeping prices constant also avoids making your current customers angry (because they are locked into long-term contracts at the higher prices). 450mm wafers had a lot of other issues that made them only a marginal improvement in capacity over 300mm. The biggest bottleneck now is throughput of the EUV scanners, and that doesn't scale with the size of the wafers making 450mm little better than 300mm.
The problem is they got caught also in the bitcoin bubble demise and as usual for Asian companies, they a damn slow to adapt to it, bureaucrats, they sometimes even top Soviet habits, but hey... PCR is near lol. They didn't realize it is over, NVidia strongly signaled with making silicon at Samsung that the games are over and TSMC cannot play the monopoly card also, as they wanted larger piece of the pie. Soon many fabs will become operational and let us see how the greed will pay off.
The objective historical statistics should be normalized without silicon made for crypto. Then the real consumer device market demand number should align as it should, with increase actually, yes. Covid did spark some numbers up, but not that drastically as you wish... I suspect those numbers got mixed with crypto and some(nvidia) did that on purpose. There were need for basic laptops and PCs for school/work etc but why the heck why that would need overpriced RTX cards to have online lectures or work meetings? For RTX crap voice as some leather jacket tried to upsell as next best thing since sliced bread? The amount of farming was huge everywhere, people only grasp a small part of it from media and think that it doesn't happen around them, but it did. TSMC suffers from it, they are slow to adapt. That was known already more than half year ago and still they act like princesses.
Considering supplies, they most probably have them already stocked as much they can as they don't become cheaper and because of the war there are obvious difficulties.
Also it is known for fabs that it costs way more to turn on the gears for fewer orders than fully loaded and same type of design, it is only 50%, that's really a tragic number. Basically greed backfired, nothing else, it will hurt them.