A 14-nanometer limited rumor stoking TSMC to the forefront of the storm, accompanied by the various guesses of the receiver. Affected by the news, yesterday before the Hong Kong stock market closed, including SMIC, Huahong Semiconductor, including wafer foundry concept shares rose, including Huawei’s transfer news, SMIC closed at HK$11.42, up 4.2%.
But from the process of information dissemination, the description of the process node and Huawei’s order is more of an outside guess and comment, the original source did not even mention the name of the above manufacturers. TSMC had to respond on the 25th, the United States has not changed the rules, TSMC will not answer the hypothetical question.
In the long run, the rise of the local semiconductor industry, from design to foundry, sealing and testing should be autonomous, SMIC and other wafer foundry factory rise is only a matter of time, to undertake Huawei and other large factories high standard orders in the future may also be achieved. But in the short term, integrated circuit manufacturing is a capital and technology-intensive industry, which requires constant capital investment, especially if you want to “overtake” in the wafer foundry on the spire of the “pyramid” tower, and bear huge expenses and the risk of total failure.
Over the past few years, the micro-miniature of chips at each node has become more expensive and complex. Only a few companies can afford to design chips on advanced nodes. According to IBS, the cost of DESIGN alone jumped from $51.3 million for 28nm graphic devices to $297.8m for 7nm chips.
As a result, the average revenue per wafer has hit the ceiling. IC Insights points out that the advanced process technology has affected the revenue per wafer, with an average revenue of 0.5-8-inch wafers of only $370 per piece, while an average revenue of $6,050 per piece of 12-inch wafers under 20 nanometers.
Due to market pressure, some fab foundry giants began to choose to “stop” and review the consequences of constantly “burning money” into advanced technology. In August last year, GLOBALFOUNDRIES, formerly known as Grofond, officially announced that it was shelving the 7Nm FinFET project and adjusting its research and development team to support the enhanced product portfolio.
At present, TSMC power to maintain a unique position, the main reason is that it almost occupied the first process node market, especially in this year’s 7nm process, TSMC won most of the market orders.
In the fourth quarter of this year, TSMC ranked first with total revenue of $10.225 billion, with a market share of 52.7%, the second as Samsung with 17.8%, and SMIC in fifth place with $841 million in total revenue and a 4.3% market share. There is still a gap compared to head manufacturers.
But that doesn’t mean mainland manufacturers don’t have a chance.
SMIC’s 14nm process is only two generations behind the world’s most advanced 7nm. Guoxin Securities believes that the mainland chip design company to seek mainland contract work is an inevitable trend. As a mainland semiconductor foundry leader, SMIC International has sufficient production capacity and diverse production lines, suitable for many chip foundry needs. Streaming chips with a 14nm process are a good start for SMIC, from risk production to scale mass production, and now more than ten customers have adopted SMIC’s 14nm process.
But also to see that in the input of advanced process, “burning money” pressure will always exist, and another unstable factor that can not be ignored comes from the peripheral environment.
U.S. pressure on upstream suppliers will not just target a manufacturer, after dutch photolititt supplier ASML’s ultra-violet light (EUV) photolithography machine to SMIC’s plan was delayed, it is not difficult to guess also from the United States pressure. If The U.S. technology standard for export controls for Huawei were to be raised from 25% to 10%, it would not be a few companies that would be hit. Enterprises at this time to do, only to speed up the pace, continue to expand the strength of research and development.