Beneficiary of TSMC Accident
Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest semiconductor foundry, is expected to see its reliability be hit by a defective wafer incident. The amount of contaminated wafers is estimated to far surpass US$500 million (559.25 billion won). The accident came again six months after TSMC halted its production lines due to a ransomware attack in August last year. Accordingly, some market experts even say that its competitor Samsung Electronics Co. will benefit from the incident.
Nearly tens of thousands of 300 mm wafers were contaminated at TSMC’s Fab 14B production facility in southern Taiwan on Jan. 28, according to foreign media reports on Jan. 30. The exact scale of damage was not disclosed but it is estimated that it will affect up to 90,000 wafers. The Fab 14B essentially produces 12 and 16 nm central processing unit (CPU), graphics processing unit (GPU) and application processor products for NVIDIA Corp., AMD Inc., Huawei Technologies Co. and MediaTek Inc.
The company said the problem was caused by a photoresist material which failed to pass the quality test. A photoresist, which changes the nature by responding to particular wavelengths of light, is a key material used in exposure processes to form a patterned coating on a surface of semiconductors. Japan's Shin-Etsu Chemical Co. and JSR Corp. and Michigan-headquartered Dow Chemical Co. are the three companies that provide TSMC with photoresist chemicals. The buyer and suppliers are still investigating the cause for the incident.
With the incident, TSMC has to take a considerable amount of loss in sales. The 16 and 20 nm wafers are TSMC’s main product which accounts for most of its total sales with 23 percent in 2018 and 25 percent in 2017. The revenue per wafer reaches US$6,050 (6.77 million won) when producing 300mm wafers with below the 20nm process, according to a report released by market research firm IC Insights last year. Considering the characteristics of foundry, the price of wafers vary depending on which product and who the producer is. However, TSMC suffered a loss of about US$544.50 million (609.02 billion won).
An even bigger problem is that TSMC’s reliability will take a blow. It is the most import to meet the delivery date in the customized manufacturing industry. TSMC also got in trouble with delivery in August last year after it shut down three production lines because of the “WannaCry” ransomware virus. Two incidents which greatly affected production occurred just in six months.
Samsung Electronics is forecast to benefit from TSMC’s incident. Samsung Electronics vice chairman Lee Jae-yong also met with Hong Young-pyo, floor leader of the ruling Democratic Party (DP), and showed a strong intention to focus on the non-memory chip sector on Jan. 30. In fact, the company is closing in on TSMC by introducing the most advanced extreme ultraviolet (EUV) exposure equipment before the world's largest contract chipmaker. Samsung Electronics has secured large clients, such as Qualcomm Inc. and IBM Corp., and is also in discussion with NVIDIA.