TSMC (Apple) Update Q2 2015!

The TSMC quarterly conference call was last week and of course it stirred up quite a bit of controversy. Let me share with you my experience, observations, and opinions and maybe together we can come up with an accurate prediction for 2016. First let’s take a look at 20nm and what people now call the “Apple effect.”

Correct me if I’m wrong here but this is how I remember it: The TSMC 20nm process was highly criticized for cost, power leakage, and yield prior to the arrival of the Apple A8 and A8x SoCs. As we now know 20nm was the fastest ramping process in the history of TSMC and the A8 powered iPhone 6 is a huge success. This much is now well documented.

Next came TSMC 16nm. Unfortunately, the first 16nm process did not meet expectations of the fabless semiconductor ecosystem as compared to Intel and Samsung 14nm. Intel 14nm was faster and denser and Samsung 14nm was lower power. This was clearly a missstep for TSMC but they learned from it and came back with 16FF+ (second generation FinFETs) which is now the best performing process of its kind. TSMC openly makes this claim but I have confirmed it with several early access IP and fabless companies and they would know. 16FF+ based mobile products will hit the market in Q4 2015 and you will be impressed, absolutely.

TSMC 16FF+ does use the same BEOL (back end of line) as 20nm, which is the second half of the chip manufacturing process. The FEOL (front end of line) however is quite different. In fact, you will see a difference between the original TSMC 16nm and 16FF+ which has resulted in a significant PPA improvement (performance, power, and area). So when Morris Chang claims that 16FF+, which is technically their second generation FinFET, will be an even faster ramp than 20nm I believe it to be true.

As I predicted last year, Apple chose Samsung 14nm LPE for the iPhone6S (A9 SoC) and TSMC 16nmFF+ for the iPads (A9x). I stand by that prediction even though on the conference call Morris Chang said that in 2016 TSMC 16nm market share will be much greater than “our next competitors.” Given that Apple and QCOMM, TSMC’s two largest customers, are currently using Samsung 14nm there is really only one way this prediction can come true: Apple and QCOM will use 16FFC (TSMC’s third FinFET generation) for their SoCs in 2016.

TSMC also mentioned that 10nm will be in production in Q1 2017 which supports the above prediction that the iProducts released in 2016 will not be 10nm. The other interesting thing to note is the PPA numbers for 10nm: 15% speed gain at the same total power, or more than 35% power reduction at the same speed, and with k density of 2.2 times that of 16nm FinFET. I can tell you that Apple will not accept a 15% speed gain for a new process. I was told that the new 16FFC process due out mid 2016 was built “with” Apple so I would expect the same for 10nm. 16nm FF+ provides a 40% higher speed and 60% power savings over 20nm. My prediction is that the Apple version of 10nm for the 2017 iProducts will offer a minimum 25% speed increase.

Sound reasonable?

The conference call transcript is HERE.