Intel’s 7nm Delay Presents Opportunity for AMD

AMD’s gain in market share against Intel is more likely, as we reported earlier, given Intel’s yet another delay on its technology roadmap announced last week.

While about half of AMD’s sales rely on Taiwan Semiconductor Manufacturing Co. (TSMC) for 7nm production, nearly all of AMD’s output will be made at TSMC’s leading-edge nodes by 2021, according to Wedbush Securities vice president Matt Bryson. Contrast that with Intel, which again delayed its expectations, saying the company’s first 7nm product will not be ready until late 2022 or early 2023.

AMD’s gain in x86 CPU market share was estimated at about 15% in 2019 compared with 84% for Intel. Intel’s only significant challenger in CPUs is likely to see more gains as it uses its foundry partner TSMC to put more cores into the marketplace, according to Kevin Krewell, principal analyst at TIRIAS Research.

“AMD is well positioned to gain share,” Krewell said in a July 26 interview with EE Times. “AMD made a much bigger bet on chiplets.”

Late last year, TSMC announced its first chiplets as part of an approach to packaging three-dimensional chips that improve performance, power consumption and transistor density, as Moore’s Law loses steam.

AMD will be shifting to 5nm for its server chips in 2021 and should advance to TSMC’s 3nm process by 2023, so AMD has the “runway” to seek market share gains, Credit Suisse vice president Randy Abrams said in a July 24 report provided to EE Times. Intel would be able to consider using TSMC for 3nm production by 2023 if Intel’s manufacturing roadmap continues to slip, the report said.

AMD is poised to increase its allocation of 7nm capacity from TSMC as the world’s largest foundry in September this year ends its production of 7nm chips for Huawei subsidiary HiSilicon, which has been blacklisted by the U.S. government. In the first quarter of this year, HiSilicon accounted for about 14% of TSMC’s total production.

Intel’s Foveros packaging technology is more advanced than TSMC’s chiplet solution because it involves 3D stacking, Krewell said. Yet Intel has been slow rolling out the technology, he added.

AMD’s EPYC server processors and the company’s Ryzen desktop CPUs are made with the chiplets developed by TSMC, Krewell said.

To be sure, Intel still enjoys some key advantages in its competition with AMD.

Intel can appeal to customers with lower prices, according to Krewell. Intel also has some architecture advantages like DL Boost instructions and AVX512, he said. AMD has advantages in more cores and more PCIe lanes, Krewell added.

Shift to Foundries
Intel last week said that it may outsource more of its production to foundries such as TSMC. Intel has used TSMC for production of chips made with legacy technology. It would be a first for Intel to use foundries for production at advanced nodes including 10nm and below.

In a conference call following the company’s quarterly financial results last week, Bob Swan, who has been CEO at Intel since January last year, had quite dubious comments about whether he will outsource more production to foundries.

“What’s different is we’re going to be pretty pragmatic about — yes if, and if and when we should be making a step inside or making it outside and making sure that we have optionality to — build internally mix-and-match inside and outside or go outside in its entirety,” Swan said.

It’s unlikely that Intel would outsource all of its production the way that AMD did when it sold off its chip facilities years ago to become a fabless company, according to Krewell. “Intel will have to decide are they a manufacturing company or a product company,” he said. “They can still mix both.”

Every new process node has challenges, but the consequences for getting it wrong, can be months or years of delays, Krewell said. Every semiconductor company that relies on leading edge nodes, needs contingency plans, and no company is immune, he added. Being able to mix chips from different foundries in a package will be part of a flexible configuration that Intel is likely to adopt in the future, according to Krewell.

Reviving U.S. Industry
Intel’s stumble is yet another sign that the U.S chip industry is losing vitality.

The company’s plan to outsource more production should ring alarm bells in the U.S., according to Harvard Business School professor Willy Shih, in a July 26 article published in Forbes magazine.

“Intel has lost ground to AMD in the x86 microprocessor market because AMD has well designed products that are manufactured by TSMC,” Shih said. “The only place Intel can go to catch up with AMD is TSMC, so the pressure on them to outsource to there (Intel already is an important customer) will be intense.”

The U.S. has slid from first in manufacturing at the inception of the chip industry to fifth, and companies in those countries that are ahead of the U.S. are investing aggressively, according to Shih. U.S. chip tool makers have been moving their manufacturing to Asia as well, because that’s where their customers are, he said.

Efforts in the U.S. government to restore American manufacturing competitiveness are rare, according to Shih. He advised that government subsidies for production should be coupled with funding to create demand to ensure the sustainability of the American chip industry.

Last week, the Senate voted (96-4) to include an amendment to the National Defense Authorization Act (NDAA) to provide support to the U.S. chip industry. The amendment combined the earlier American Foundries Act (AFA) and the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act. A nearly identical proposal included in the House NDAA bodes well as the bill goes into the Conference Committee, Shih said. But the vote does not authorize or appropriate funding for these policies, it only creates the policy framework, he added.

The post Intel’s 7nm Delay Presents Opportunity for AMD appeared first on EE Times Asia.

from EE Times Asia https://ift.tt/3f5edpN