TSMC has notified clients an about 10% price hike for its sub-16nm process manufacturing, with the new prices set to be effective starting 2022, according to sources at IC design houses.
The upcoming price increases initiated by TSMC will also be for the orders scheduled to be fulfilled starting December, said the sources.
TSMC will also raise its quotes for 16nm and above process technologies by as much as 20%, with the new prices also reflecting in contract quotes for new orders set to be fulfilled starting December, the sources noted.
TSMC has responded saying it does not comment on reports about its foundry quotes.
The upward adjustments in TSMC's foundry quotes will start making a positive contribution to the foundry's gross margin and profit performance in the fourth quarter of 2021, market observers believe. In particular, higher quotes for its advanced-node manufacturing will further boost its margins and profitability, the observers said.
TSMC saw sales generated from 7nm and more advanced process technologies account for as high as 49% of its total wafer revenue in the second quarter of 2021.
TSMC in March notified clients price discounts for all orders through 2022 would be canceled, which is seen as a form of price hikes, the sources noted.
Fellow foundry houses including United Microelectronics (UMC) and Powerchip Semiconductor Manufacturing (PSMC) have already initiated several price hikes starting the second half of 2020, the sources said. PSMC chairman Frank Huang remarked earlier this year that pure-play foundries were just raising their quotes to fair and reasonable levels.
UMC reportedly will make another upward adjustments in its quotes particularly those for 28nm and 22nm process technologies in September, November and January 2022. UMC's quotes for 28nm processes are expected to reach between US$2,800 and US$3,000 in January 2021.
TSMC, which reportedly intended to freeze its quotes for 28nm processes, has changed its mind, planning to raise the quotes to nearly US$3,000 that will come into effect from January 2022, the sources indicated.
Globalfoundries and China-based Semiconductor Manufacturing International (SMIC) are also following in the footsteps of Taiwan-based pure-play foundries by raising their foundry quotes, particularly those for 28nm processes, according to industry sources.