Recently, Samsung Electronics has been catching up in terms of advanced wafer foundry process technology. As its 3/4nm yield rates gradually improve, the South Korean industry expects major semiconductor clients that previously redirected their orders to TSMC will return to Samsung under the demand for supply chain diversification.
Citing the wafer foundry report from Hi Investment & Securities, Korea Economic Daily pointed out that Samsung has successfully improved the yield rates for its 4nm process. This development increases the possibility of Qualcomm and Nvidia once again entrusting Samsung's foundry services. It's speculated that in 2023, Samsung's 4nm yield rate has achieved 75%, while the 3nm yield rate is around 60%.
Industry speculation was that, at the start of 2023, TSMC's 4nm yield rate was around 70–80%, while Samsung's was still around 50%. If Samsung can achieve 75%, it means that it's approaching TSMC's level. Hi Investment & Securities stated that Samsung was able to improve its yield rate in such a short period due to the industry-wide downturn. With factory utilization rates decreasing, Samsung has increased the input of test wafers, which has effectively improved the yield rates for processes under 7nm.
Since Samsung's wafer foundry business started delving into processes below 10nm, it has encountered issues like product launch delays and slow yield rate improvements. This has caused major customers like Apple, Nvidia, and Qualcomm to redirect their orders to TSMC. In 2022, TSMC's capital expenditure (Capex) and capacity (CAPA) reached 3.4 times and 3.3 times that of Samsung's foundry business division. It also achieved a 90% market share for processes under 7nm, further widening the gap with Samsung.
Despite that, industry sources pointed out that as Samsung gradually improves its yield rates for the 3–5nm processes and remains the only competitor with the capability to mass-produce the GAAFET technology, it's expected to receive some returning orders due to an increased demand for supply chain diversification from current TSMC customers.
Besides catching up in the 3/4nm processes, Samsung has also accelerated its R&D to achieve mass production of its 2nm technology by 2025. Previously, Samsung announced a roadmap for wafer foundry processes below 2nm, with plans to begin mass production of the 2nm process (SF2) by 2025 with a focus on mobile devices. This will be followed by adding high-performance computing (HPC) in 2026 and expanding to automotive semiconductors by 2027. The 1.4nm process is scheduled for mass production in 2027.