No, no poof. This article has a horrible title. $500 million is lost in the first quarter true, but it'll be made up in the second (which the article does say). After all, that $500 million in business won't just move to the next fab overnight for production. Changing fabs is extremely hard. Yes, SOME business MIGHT be lost, since late delivery might mean some reduction in volume, but it'll be pretty small. Also, the actual product they lost will cost something, but nowhere near the $500 million figure. HORRIBLE title.
...no, it’s not. Until TSMC negotiates and delivers the wafers at 100% of the initial price, the revenue is gone.
The article title is 100% true. If TSMC is actually able to secure the production at 100% of the price, then you are still wrong - the tools and fab have a defined useful life, and it’smeasured in wafers produced - these wafers were bout and scrapped, which is a real loss not just in revenue but in the cost of producing the wafers themselves.
Wrong! Fact 1: Resist are not charged into Lithography foster tools in Jugs. The most common means is via bottles. Fact 2: Resist was already compromised when it arrived from the realist supplier hence the stated corrective action was to enforce stricter inspection of of incoming material ie IQC
AMD doesn't use 16nm process, they use 14nm and 12nm they already use GloFo. And the second source is Samsung (as GloFo licensed these two from Samsung, so for AMD little work to do to switch between the two). As for TSMC, the only process currently in use by AMD is the 7nm process which if these news are to be taken is not affected by the contamination.
PS4 Slim/Pro; Xbox One S/X SoCs are all fabbed at TSMC 16FF+. Those actually might be AMD's highest volume products. Granted, it's a co-development between AMD and Sony/Microsoft, so not quite the same.
Yes they're AMD designs but Sony and MS own their respective iterations. This came about bc when MS used Intel /Nvidia for the original XBOX they had to abruptly stop bc both no longer made their chips. So the original XBOX disappeared over night. In order to not be put into that position again, they wanted to own their design.
The simpler thing for TSMC to do here is to go after it’s resist supplier. Doing an insurance claim is very straight forward but the premiums thereafter to be paid will be elevated cos of the payout, not a wise move in the long run right?
1) Has AMD postponed the launch of Zen 2? If so, can you show me a source for this? From all their public statements that I've seen, Zen 2 is on track.
2) So you're accusing TSMC of lying to investors, then? Given that AMD only uses the 7nm node from them, and they're explicitly saying this only affected 12nm and 16nm, that would indeed be an outright lie - which at least in the US is grounds for a lawsuit.
@Anton, thanks for this follow up story. I strongly suspect that this screw up was due to reduced QC at TSMC. That company must be under enormous pressure to generate the revenue to pay the loans off TSMC had to take out to pay for its new flagship 7 nm Fab, so economizing is high on the agenda. Cutting QC is one of those cuts that tends to be made in those situations. Yes, the supplier or shipping company messed up first, but any Fab that knows its business won't take a supplier's analysis sheet at face value - not for a mission critical step like photolithography.
$550 Million for the worst case of 30000 affected wafers means that each of them costs $20k. I think it is a bit too high a price or I am missing something.
Labor and missed deadlines on contract deliveries, rework, root cause analysis investigations, shutting down production while the problem was isolated...there is a lot more happening here than loss of raw materials.
Most of what you list is already included in the cost of the new wafer they had to start in place of those scrapped. I doubt missing the delivery date is going to costs x4 the value of a wafer. I think that TSMC is hiding some other losses into this accident, like for example less revenue due reduced iPhone and other smartphones production (together with probably nvidia reduced wafer requests seen their stock levels). Putting those losses into the cost of the accident simply does not appears like a slowing down of their business, seen they are quite exposed and need to have the best market conditions to pay their debts.
The winner in all of this? Probably Nvidia if it was GPU production... aren't they already reporting that new RTX line isn't selling as fast as they wanted and then there is still the overhang of oversupply of GTX 10x0 in the market, to they get a rebate on their orders or discount for late delivery or just get to not pay for them until the next quarter...?
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Gunbuster - Wednesday, February 20, 2019 - link
TLDR: Factory worker screws up a jug of chemical. TSMC tossed the jug into their machines with no QC. Half a billion $ poof gone.repatch - Wednesday, February 20, 2019 - link
No, no poof. This article has a horrible title. $500 million is lost in the first quarter true, but it'll be made up in the second (which the article does say). After all, that $500 million in business won't just move to the next fab overnight for production. Changing fabs is extremely hard. Yes, SOME business MIGHT be lost, since late delivery might mean some reduction in volume, but it'll be pretty small. Also, the actual product they lost will cost something, but nowhere near the $500 million figure. HORRIBLE title.Sahrin - Saturday, February 23, 2019 - link
...no, it’s not. Until TSMC negotiates and delivers the wafers at 100% of the initial price, the revenue is gone.The article title is 100% true. If TSMC is actually able to secure the production at 100% of the price, then you are still wrong - the tools and fab have a defined useful life, and it’smeasured in wafers produced - these wafers were bout and scrapped, which is a real loss not just in revenue but in the cost of producing the wafers themselves.
HORRIBLE comment.
Morawka - Sunday, February 24, 2019 - link
Well TSMC has lowered their guidance by 3 Billion so you calculate the real cost.happily1986 - Wednesday, February 20, 2019 - link
Wrong!Fact 1: Resist are not charged into Lithography foster tools in Jugs. The most common means is via bottles.
Fact 2: Resist was already compromised when it arrived from the realist supplier hence the stated corrective action was to enforce stricter inspection of of incoming material ie IQC
Manch - Wednesday, February 20, 2019 - link
jug vs bottle...splitting hairs much? LOLLMonty - Wednesday, February 20, 2019 - link
I wonder if any of this will be covered by insurance.Since I'm eagerly awaiting Zen 2, I'm glad AMD wasn't affected. 🙂
Xajel - Wednesday, February 20, 2019 - link
AMD doesn't use 16nm process, they use 14nm and 12nm they already use GloFo. And the second source is Samsung (as GloFo licensed these two from Samsung, so for AMD little work to do to switch between the two). As for TSMC, the only process currently in use by AMD is the 7nm process which if these news are to be taken is not affected by the contamination.WinterCharm - Wednesday, February 20, 2019 - link
Yeah, this was a near miss for AMD.trane - Wednesday, February 20, 2019 - link
PS4 Slim/Pro; Xbox One S/X SoCs are all fabbed at TSMC 16FF+. Those actually might be AMD's highest volume products. Granted, it's a co-development between AMD and Sony/Microsoft, so not quite the same.Manch - Wednesday, February 20, 2019 - link
Yes they're AMD designs but Sony and MS own their respective iterations. This came about bc when MS used Intel /Nvidia for the original XBOX they had to abruptly stop bc both no longer made their chips. So the original XBOX disappeared over night. In order to not be put into that position again, they wanted to own their design.happily1986 - Wednesday, February 20, 2019 - link
The simpler thing for TSMC to do here is to go after it’s resist supplier. Doing an insurance claim is very straight forward but the premiums thereafter to be paid will be elevated cos of the payout, not a wise move in the long run right?TristanSDX - Wednesday, February 20, 2019 - link
wafers with Zen 2 was damaged, that is why AMD posponed launchporcupineLTD - Wednesday, February 20, 2019 - link
Did you read the article?Valantar - Wednesday, February 20, 2019 - link
1) Has AMD postponed the launch of Zen 2? If so, can you show me a source for this? From all their public statements that I've seen, Zen 2 is on track.2) So you're accusing TSMC of lying to investors, then? Given that AMD only uses the 7nm node from them, and they're explicitly saying this only affected 12nm and 16nm, that would indeed be an outright lie - which at least in the US is grounds for a lawsuit.
Simon_Says - Wednesday, February 20, 2019 - link
Unexpected benefit for AMD for sticking with GloFo 14nm for the IO dies.Samus - Wednesday, February 20, 2019 - link
Fab 14B doesn’t produce 7nm...this event only affects Fab 14B where the tainted photoresist was used.Arbie - Wednesday, February 20, 2019 - link
Of course it didn't read the article. It's just a troll. Ignore.scineram - Thursday, February 21, 2019 - link
Anandtech, why not delete shit like this?eastcoast_pete - Wednesday, February 20, 2019 - link
@Anton, thanks for this follow up story. I strongly suspect that this screw up was due to reduced QC at TSMC. That company must be under enormous pressure to generate the revenue to pay the loans off TSMC had to take out to pay for its new flagship 7 nm Fab, so economizing is high on the agenda. Cutting QC is one of those cuts that tends to be made in those situations.Yes, the supplier or shipping company messed up first, but any Fab that knows its business won't take a supplier's analysis sheet at face value - not for a mission critical step like photolithography.
CiccioB - Wednesday, February 20, 2019 - link
$550 Million for the worst case of 30000 affected wafers means that each of them costs $20k.I think it is a bit too high a price or I am missing something.
PeachNCream - Thursday, February 21, 2019 - link
Labor and missed deadlines on contract deliveries, rework, root cause analysis investigations, shutting down production while the problem was isolated...there is a lot more happening here than loss of raw materials.CiccioB - Thursday, February 21, 2019 - link
Most of what you list is already included in the cost of the new wafer they had to start in place of those scrapped.I doubt missing the delivery date is going to costs x4 the value of a wafer.
I think that TSMC is hiding some other losses into this accident, like for example less revenue due reduced iPhone and other smartphones production (together with probably nvidia reduced wafer requests seen their stock levels).
Putting those losses into the cost of the accident simply does not appears like a slowing down of their business, seen they are quite exposed and need to have the best market conditions to pay their debts.
PeachNCream - Friday, February 22, 2019 - link
That reads like a conspiracy theory. Have fun with it.CiccioB - Friday, February 22, 2019 - link
It's just math that doesn't make up.Morawka - Sunday, February 24, 2019 - link
Not really, they are reporting 500 Billion in losses but adjusting their guidance by 2-3 billion.Morawka - Sunday, February 24, 2019 - link
oops, 500 Million is what I meant to say.boozed - Thursday, February 21, 2019 - link
OopsieFreeb!rd - Thursday, February 21, 2019 - link
The winner in all of this? Probably Nvidia if it was GPU production... aren't they already reporting that new RTX line isn't selling as fast as they wanted and then there is still the overhang of oversupply of GTX 10x0 in the market, to they get a rebate on their orders or discount for late delivery or just get to not pay for them until the next quarter...?