Interesting article and graphics from DigiTimes. Both Intel and Samsung are IDM Foundries which is very different than the pure-play foundry players TSMC, UMC, Globalfoundries, and SMIC. This of course changed when Intel bought pure-play foundry Tower Semiconductor. Now Intel has a pure-play store front for their IDM foundry business. Brilliant move in my opinion. Not only does Intel get the appearance of a pure-play foundry, Intel also gets a wealth of pure-play experience from the Tower management and rank and file. It will be interesting to see how Intel retains the Tower Semiconductor talent. My hope is that the Tower management will assume control of IFS. If not there could be a mass exodus and it will be $5.6B not well spent, my opinion.
The CAPEX for 2022 is telling. If you exclude the memory CAPEX from Samsung, which in my estimation is 40%, TSMC is outpacing both Intel and Samsung for logic manufacturing capacity by a large margin. I also think TSMC is winning the matching CAPEX race with partnerships in Japan, Arizona, and others in process. TSMC also gets customer prepays for new fabs. So it is a race but TSMC clearly has the advantage.
The next big move would be Samsung acquiring Globalfoundries. That would certainly shake the foundry business up. Globalfoundries and Samsung partnered for 14nm so they have common footing there and Samsung definitely has the money to spend. Samsung has clearly stated on many occasions that they want to be the #1 foundry in the world. That is a very challenging task against just TSMC. Now with Intel back in the foundry game Samsung is really going to have to get disruptive and invest heavily.
Acquiring Globalfoundries would be a definite shortcut and would get Samsung's market share into the double digits (Samsung 8.7% + GF 5.7%). TSMC sits at 60%, UMC is 7.9%, SMIC is 5.7%, and Intel/Tower 1.6%.
Currently TSMC is #1 at $568.2B, Samsung is $82.9B, UMC is $75.5B, GF is $65.5B, and SMIC is $54.4B. I see zero chance of Samsung or Intel coming even close to TSMC in the next 10 years unless a serious disruption occurs.
Although Samsung did not disclose specific numbers regarding the capital expenditure for its foundry business, its capital expenditure for memory, foundry, and system ICs was about KRW 43.6 trillion (US$35.6 billion) in 2021. Sources at the South Korea semiconductor supply chain said TSMC's expanded investments would make it more difficult for Samsung to catch up with the Taiwanese giant in the foundry market.
Meanwhile, sources familiar with Samsung said the company will try to pay attention to the market developments in 2022 and continue its semiconductor investments. They said Samsung is considering investing in factories in Pyeongtaek-si, South Korea and Taylor, Texas, US. Market observers predict that Samsung's semiconductor investment would reach US$38 billion in 2022.
Meanwhile, sources at the Korea Semiconductor Industry Association said that if TSMC is considered a food court, Samsung should strive to become a Michelin star restaurant. In other words, the sources believe that Samsung can attract more clients by optimizing legacy nodes and adding investments in advanced processes.
In contrast, 70-80% of TSMC's capital expenditure will be used toward the development of 2nm-7nm advanced processes.
As TSMC and Samsung expand their semiconductor investments, Intel has stepped up its investments in the foundry business. The US tech giant recently announced plans to develop a Silicon Heartland in Columbus, Ohio with a US$20 billion investment to set up two new foundries in the beginning and eight foundries eventually. The company is expected to spend over US$100 billion on the project over the next decade.
TSMC, Samsung, and Intel are all planning to set up new factories in the US. Samsung will enter volume production of its 3nm process in the first half of 2022, deliberately ahead of TSMC's planned 3nm mass production in the second half of the year. Although Intel has yet to begin its 7nm process, industry analysts said the three companies will likely compete to achieve 2nm process production in 2025.
The CAPEX for 2022 is telling. If you exclude the memory CAPEX from Samsung, which in my estimation is 40%, TSMC is outpacing both Intel and Samsung for logic manufacturing capacity by a large margin. I also think TSMC is winning the matching CAPEX race with partnerships in Japan, Arizona, and others in process. TSMC also gets customer prepays for new fabs. So it is a race but TSMC clearly has the advantage.
The next big move would be Samsung acquiring Globalfoundries. That would certainly shake the foundry business up. Globalfoundries and Samsung partnered for 14nm so they have common footing there and Samsung definitely has the money to spend. Samsung has clearly stated on many occasions that they want to be the #1 foundry in the world. That is a very challenging task against just TSMC. Now with Intel back in the foundry game Samsung is really going to have to get disruptive and invest heavily.
Acquiring Globalfoundries would be a definite shortcut and would get Samsung's market share into the double digits (Samsung 8.7% + GF 5.7%). TSMC sits at 60%, UMC is 7.9%, SMIC is 5.7%, and Intel/Tower 1.6%.
Currently TSMC is #1 at $568.2B, Samsung is $82.9B, UMC is $75.5B, GF is $65.5B, and SMIC is $54.4B. I see zero chance of Samsung or Intel coming even close to TSMC in the next 10 years unless a serious disruption occurs.
TSMC and Intel expanding investments in chip manufacturing
TSMC recently announced that its 2022 capital expenditure would reach US$44 billion, increasing 40% from 2021, and surpassing Samsung's US$3.8 billion. The news stunned the South Korea semiconductor industry. The "money war" has put Samsung in a tough situation.Although Samsung did not disclose specific numbers regarding the capital expenditure for its foundry business, its capital expenditure for memory, foundry, and system ICs was about KRW 43.6 trillion (US$35.6 billion) in 2021. Sources at the South Korea semiconductor supply chain said TSMC's expanded investments would make it more difficult for Samsung to catch up with the Taiwanese giant in the foundry market.
Meanwhile, sources familiar with Samsung said the company will try to pay attention to the market developments in 2022 and continue its semiconductor investments. They said Samsung is considering investing in factories in Pyeongtaek-si, South Korea and Taylor, Texas, US. Market observers predict that Samsung's semiconductor investment would reach US$38 billion in 2022.
Meanwhile, sources at the Korea Semiconductor Industry Association said that if TSMC is considered a food court, Samsung should strive to become a Michelin star restaurant. In other words, the sources believe that Samsung can attract more clients by optimizing legacy nodes and adding investments in advanced processes.
In contrast, 70-80% of TSMC's capital expenditure will be used toward the development of 2nm-7nm advanced processes.
As TSMC and Samsung expand their semiconductor investments, Intel has stepped up its investments in the foundry business. The US tech giant recently announced plans to develop a Silicon Heartland in Columbus, Ohio with a US$20 billion investment to set up two new foundries in the beginning and eight foundries eventually. The company is expected to spend over US$100 billion on the project over the next decade.
TSMC, Samsung, and Intel are all planning to set up new factories in the US. Samsung will enter volume production of its 3nm process in the first half of 2022, deliberately ahead of TSMC's planned 3nm mass production in the second half of the year. Although Intel has yet to begin its 7nm process, industry analysts said the three companies will likely compete to achieve 2nm process production in 2025.
Global chipmakers find ways to improve competitiveness
Amy Fan, Taipei; Kevin Cheng, DIGITIMES
www.digitimes.com
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