Samsung forced to invest 4 billion in 4 nm to stay in the race against TSMC

If Samsung has lost production of the Snapdragon 8+ Gen 1 in 4 nm, and despite entering the 3 nm era, the Korean company does not intend to abandon this fine engraving to its competitor.

The two major founders, TSMC and Samsung, have been mass-producing 4nm for several months now, but the South Korean is showing yields and capacity much lower than that of its Taiwanese competitor. A report from Economic News Daily states that Samsung will invest about 5 trillion won, or approximately US$3.7 billion, to expand its capabilities. The founder aims to produce 20,000 wafers monthly during the fourth quarter of 2023.

Samsung maintains its pawns on the 4 nm

While Samsung has outstripped TSMC for 3nm, the idea of ​​investing in 4nm may seem absurd. Especially since Qualcomm, which trusted Samsung for its Snapdragon 8 Gen 1, has entrusted the production of the Snapdragon 8+ Gen 1, still in 4 nm, to TSMC. Also, while there’s nothing official yet for the Snapdragon Gen 8 Gen 2, it’s possible that this chip will move to the 3nm burn node.

But the leaders of Samsung Foundry would like to keep and consolidate the production of chips from other companies, in particular Google’s second-generation Tensor SoCs, chips still expected to be engraved in 4 nm. Recall that some have seen in the Google Tensor SoC a slightly modified Exynos 2100.

TSMC first, Samsung second

In any case, to maintain its appeal to its current customers, and even attract others, Samsung must maintain attractive prices and sufficient production capacity. However, at the beginning of the year, industrial sources mentioned a yield of only 35% for the Snapdragon 8 Gen 1. At the same time, they suggested a yield twice as high for the 4 nm from TSMC. To make matters worse, the production capacities of the Taiwanese foundryman are much higher, with a ratio of almost 1 to 5.

Still, an investment of 3.7 billion US dollars is not a huge sum for a company like Samsung Foundry. To put this amount in perspective, remember that last year, the company advanced a plan of investment of 151 billion dollars for semiconductors by 2030.

Finally, how TSMC and Samsung will handle the transition to new types of transistors to replace FinFETs in smaller etching finesses may well reshuffle – a bit – the cards over the next few months.