Accident!The situation at SMIC has changed, TSMC officially announced, and foreign media lamented that the situation has changed abruptly!
Introduction: TSMC has always been the hegemon in the global wafer foundry field. However, SMIC didn't expect that when TSMC recently announced a major decision, the situation suddenly took a dramatic turn. This article begins with the rise and fall of TSMC, and describes in detail how SMIC was caught off guard and why TSMC lowered its ** to win customers.
The rise and dilemma of TSMC.
TSMC is able to occupy such an important position in the global foundry field due to its unique pure foundry model and excellent performance in technology and capacity. Many IC design giants use TSMC as their foundry of choice. However, TSMC has also encountered a lot of difficulties in recent years. First, the global wafer situation has taken a sharp turn for the worse, leading to overcapacity in the industry. Secondly, the United States is constantly changing the regulations on tablets, which has an impact on TSMC. What's more, the loss of Huawei, the second largest customer, has put huge pressure on TSMC's performance. The data released by TSMC's earnings report also showed that its full-year revenue fell by 7% year-on-year5%, down 153%。Capacity utilization has also continued to decline, especially for the 7nm process, which is only 50%. In order to cope with this situation, TSMC had to reduce capital expenditures and postpone the delivery of equipment to equipment manufacturers.
Lower** to attract customers.
Faced with the dilemma of declining performance and capacity utilization, TSMC lowered** to win customers. Among them, the 7nm process was considered TSMC's best process in the past, but now customers prefer to use the more advanced 5nm and 3nm processes. This has led to a decline in capacity margins for TSMC's 7nm process. Coupled with the fact that Huawei's Kirin chip is believed to be on a 7nm process, its return marks a breakthrough in the mainland chip industry. As a Chinese-funded company, SMIC's revenue is increasingly coming from mainland fabs, and its advantages are becoming increasingly obvious. TSMC has realized this problem and has therefore begun to reduce the ** of its 7nm wafer foundry in order to win the favor of Chinese companies. SMIC did not expect that even wafer manufacturing giants like TSMC would begin to cut prices to win customers. However, since the mainland has made a breakthrough in the chip industry, Chinese companies are obliged to choose a reliable ** chain in the mainland.
SMIC's rise and TSMC's dilemma.
SMIC IC Manufacturing *** Abbreviation"SMIC") is a Chinese company with a wafer fabrication facility in Chinese mainland that has made great strides in recent years. Its revenue share is increasing, and its advantages are gradually becoming apparent. In particular, Huawei's self-developed Kirin chip has attracted widespread attention. Although companies such as Huawei have not disclosed the specific details of the Kirin chip, it is widely believed that it uses a 7nm process. This breakthrough has enabled SMIC to move towards a more advanced chip manufacturing process. TSMC lowered** to win customers, but also because it was aware of the rise of the mainland chip industry. The rise of SMIC has put TSMC in a difficult situation, not only losing Huawei, an important customer, but also facing a gradual decline in market share.
Summary. TSMC has been performing well in the global foundry field, but due to various reasons, it has also faced many difficulties in recent years. SMIC, a Chinese-funded wafer manufacturing company in mainland China, has made important progress in the wafer manufacturing process and is gradually emerging. TSMC had to reduce ** to attract customers in an attempt to alleviate the decline in capacity utilization. However, the rise of the mainland wafer industry has formed an irreversible trend, and SMIC and other companies will become an important part of the mainland ** chain. For TSMC, the competition will be more fierce in the future, and how to deal with this challenge will be an important topic.