With the rapid development of the semiconductor industry, the speed of technology iteration is unprecedented. Samsung Electronics has always occupied an important position in the global semiconductor field with its innovative technology and strong manufacturing capabilities. However, as the 3nm process enters the mass production stage, Samsung has encountered huge challenges. According to reports, the 3nm process yield of Samsung's new generation Exynos 2500 chip is less than 20%, which is far from meeting the industry standard. This situation has not only slowed down the progress of its flagship product line, but also sparked discussions about cooperation with TSMC. Jukanlosreve revealed the news that Samsung is considering cooperating with TSMC to produce Exynos, although this cooperation is a little unexpected, but from Samsung's current technical bottlenecks and market competition pressure, it may be a rational choice. China Exportsemi will try to deeply analyze the dilemma faced by Samsung's 3nm technology, the possible market impact, and the potential feasibility of cooperation with TSMC.
Pictured: Jukanlosreve revealed the news that Samsung is considering a partnership with TSMC to produce Exynos
1. Technical challenges and yield issues
Samsung's low yield performance on the 3nm process has become a key issue affecting its overall strategy and performance. According to industry sources, the target yield of Samsung's second-generation 3nm GAA (surround gate) process should have reached 70%, but the actual yield is only about 20%. This means that less than one-fifth of chips meet quality standards in the mass production process, resulting in large-scale scrapping and waste of resources. Low yields not only significantly increase production costs, but also impact shipments and market confidence.
The Exynos 2500 chip, originally planned to be used in the Galaxy S25 phone, was originally intended to enhance the competitiveness of Samsung's products through technological breakthroughs in AI computing acceleration and high-performance processing. However, with such a low 3nm yield, mass production of the Exynos 2500 is almost impossible. As a result, Samsung had to switch to Qualcomm's Snapdragon 8 Ultra processor. More seriously, Samsung's low yield rate has adversely affected its future confidence, market position and customer relationships in the advanced process field.
Figure: Samsung 3nm is in trouble, TSMC may become a savior?
2. Samsung's GAA technology: Innovation and challenge coexist
Samsung's 3nm GAA process represents a major technological revolution, but it also brings significant challenges. Compared with traditional FinFET architectures, the GAA structure can provide higher control capabilities, thereby improving the performance and energy efficiency of chips, especially in high-density computing scenarios. However, due to the extremely demanding equipment and materials required by the GAA process during the manufacturing process, Samsung faced many challenges in achieving mass production.
During the design and manufacturing of the GAA process, Samsung needed to deal with high power control requirements and complex transistor structure management. In this highly complex manufacturing environment, the purity of the material and the extremely fine process control directly affect the yield performance, which is one of the reasons for Samsung's low 3nm yield. In contrast, although the FinFET process adopted by TSMC is slightly inferior in performance, due to the maturity and stability of its production process, the yield rate exceeds 80% and continues to approach the high level of 90%. This comparison makes Samsung's 3nm competitiveness relatively weak in advanced processes.
3. Market impact and cooperation prospects
In the global semiconductor foundry market, TSMC has become an industry leader with its advanced process technology and efficient production capacity. If Samsung chooses to cooperate with TSMC, it will alleviate the production capacity problem of Exynos chips, at least in the short term, and help Samsung strengthen its position in the smartphone and AI computing markets. For TSMC, although Samsung is its competitor, taking on the foundry business of Exynos may also present an opportunity for TSMC to further expand its market share.
However, this cooperation model also means that Samsung will rely more on TSMC for advanced processes, thus exacerbating the delicate nature of the competitive landscape. Market analysts believe that Samsung may lose up to 1 trillion won in the third quarter of 2024 due to the low yield of the 3nm process. Such financial pressures will inevitably prompt Samsung to look for ways to improve its competitiveness in the short term, and TSMC is very attractive in this scenario.
It is worth noting that such a cooperation could trigger a chain reaction along the supply chain, especially in the context of US-China technology competition. TSMC's central position in the global semiconductor industry makes every business decision have a profound impact on the industry, and the cooperation between Samsung and TSMC may further strengthen TSMC's industry leadership.
4. Long-term consequences and market outlook
If Samsung succeeds in reaching a cooperation agreement with TSMC, it will help it improve the market competitiveness of Exynos chips and rebuild its brand image in the AI computing and smartphone markets. However, behind this cooperation lies a test of future business models. Samsung needs to strengthen its advanced process technology capabilities while weighing the risks of its dependence on TSMC to ensure that its independence is not compromised.
From a global market perspective, Samsung's partnership with TSMC also means further consolidation in the industry, and the global semiconductor ecosystem may change as a result of this collaboration. Especially with the intensification of technology competition between China and the United States, the global semiconductor supply chain has become increasingly complex and sensitive. Samsung's move could trigger a further U.S. reaction to China's semiconductor industry restrictions, and also have a non-negligible impact on the global supply chain.
5. Competition and self-improvement in the industry
If Samsung wants to occupy a place in the future semiconductor market, it must continue to improve its process technology. In addition to GAA technology, Samsung can also gradually improve yield by investing in advanced equipment, strengthening quality management, and technology research and development. In addition, Samsung also needs to rethink chip design, production process and management mode in order to achieve stronger competitiveness in the future competition.
By continuously optimizing the manufacturing process, Samsung can gradually solve the yield problem while accumulating a deeper technical foundation, and eventually it is expected to reach a level comparable to TSMC in advanced manufacturing processes. In the future market competition, enterprises that can achieve self-improvement and technological breakthroughs can maintain an undefeated position in the fierce industry competition.
6. Conclusion
In the context of the intensification of the global semiconductor competition pattern, Samsung is facing unprecedented challenges due to the 3nm yield problem, and TSMC has become its potential savior. This cooperation not only involves technical issues such as yield and process, but also affects market competitiveness and supply chain stability. For Samsung, partnering with TSMC will help it improve its product competitiveness in the short term, but in the long term, it will need to strike a balance between improving its own process capabilities and maintaining its independence.
Against the backdrop of intensifying technology competition between China and the United States, Samsung's choice will also have a significant impact on the future of the global supply chain and the semiconductor industry. In the future, the success or failure of the semiconductor industry will depend on the optimal balance between technological breakthroughs, independent innovation and global cooperation.
