|Analysts: TSMC still faces 40-nm problems
(11/06/2009 4:54 $� EST)
| SAN JOSE, Calif. — Silicon foundry giant Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) is still having yield issues with its 40-nm process, according to analysts.
TSMC’s 40-nm yield problems surfaced earlier this year, but the company claimed it largely resolved the problem. However, during a conference call on Thursday, graphics chip maker Nvidia Corp. discussed 40-nm capacity and yield constraints at its foundry partner–TSMC.
Advanced Micro Devices Inc.’s graphics chip group is also seeing similar problems at TSMC, but not all are suffering with lackluster yields. John Daane, president, chief executive, and chairman of the board of Altera Corp., said that the FPGA house has been shipping parts, based on a 40-nm process from TSMC. ”The yields are good,” Daane told EE Times.
Nvidia, in contrast, has been vocal about the yield problems. ”Overnight, Nvidia discussed 40-nm capacity constraints at its foundry supplier TSMC,” said Barclays Capital analyst C.J. Muse.
”Management discussed yields improving but that allocations still remain inadequate. Though yields were improving, they were important enough for TSMC to mention a chamber matching problem on its conference call earlier this earnings cycle,” he said in a report, which is based on Nvidia’s conference call to discuss its results.
Reports surfaced that TSMC is having issues with its ion implanter supplier, causing a shortfall of 40-nm parts. ”Demand (at Nvidia) far exceeded supply, particularly in the 40-nm product area; the company is in a ‘sold out’ situation and this is likely to continue for the next several months. Virtually all products are on allocation with very lean inventories in the channel,” said Hans Mosesmann, an analyst with Raymond James & Associates, in a report.
”Both AMD and Nvidia are supply constrained, and Nvidia is likely getting most of the allocation,” he said. AMD’s graphics chip unit is also using TSMC as a foundry.
”With both AMD and Nvidia being supply constrained, the supposed 2-month AMD market advantage in new DX-11 GPU’s is irrelevant in our view. AMD just missed an important window of opportunity this season in our opinion,” he said.
Graphics chip vendor Nvidia Corp.’s third quarter sales increased to $903.2 million, up 16 percent compared to the second quarter and up less than 1 percent compared to the third quarter of 2008, the company said Thursday (Nov. 6).
Nvidia (Santa Clara, Calif.) recorded a third quarter GAAP net income of $107.6 million, or 19 cents per share, up from $61.7 million, or 11 cents per share, in the year-ago quarter, the company said.
Nvidia’s results exceed consensus analyst expectations for the third quarter. The comapny said it expects fourth quarter sales to be up about 2 percent compared with the third quarter.
”Of particular note, management stated GPUs (40nm specifically) were supply constrained in the quarter, and it could remain that way through FQ4,” warned analyst Doug Freedman of Broadpoint AmTech.
”Nvidia guided 3Q sales to grow 2 percent sequentially to $921 million, better than the Street estimate of $868 million. Management’s conservative bias was driven by supply constraints, low 40-nm yields at TSMC, and current lead times of 12 to 13 weeks,” added Craig Berger, an analyst with FBR.