Semiconductor Industry: US and Taiwan Leading Semicon Process Technology

The author is an analyst of NH Investment & Securities. He can be reached at hwdoh@nhqv.com. — Ed. 

Compared to that of competitors, Samsung Electronics’ memory semicon process conversion is proving slow and its foundry yield rate sluggish. In addition to benefiting the memory semiconductor industry as a whole, this situation is a boon for competing foundries.

14nm DRAM process share at SEC in low single-digits

We previously analyzed the deterioration of Samsung Electronics (SEC)’s memory semicon technology position in our Mar 2021 in-depth report titled ‘Micron overtakes Korean memory players’. One year later, several negatives regarding SEC’s semicon technology are emerging. Herein, we give an update to the situation.

SEC’s latest memory process breaks down as 14nm DRAM and 176-layer NAND. Both processes began mass production at end-2021, and they now account for a low-single-digit portion of SEC’s total DRAM and NAND production. In the case of Micron, SEC’s main competitor in memory semiconductors, the 1anm process represents 40% of the firm’s total DRAM production, and 176-layer NAND accounts for 50% of its total NAND output. Compared to rivals, SEC’s performance appears lacking. Of note, this marks the first time since 1995 that SEC lags behind peers in the latest memory process. We mainly attribute this shortfall to SEC’s somewhat stubborn insistence on applying EUV to its DRAM manufacturing in a bid to be the world’s first to accomplish such a feat. Meanwhile, in sticking to its advanced single-stacking method for NAND, the firm failed to seize the opportune moment for a switch to NAND double-stacking.

Foundry: 4nm yield missing expectations

At the foundry business (a focal point for SEC), the situation is also disappointing, with yield for the latest 4nm process missing forecasts, and the gap with competitor TSMC widening. Looking at the 3nm gate-all-around (GAA) process, for which SEC is planning mass-production in 2022—which would secure a world’s first for the company—difficulties are also expected. Introducing an isotropic selective etch process for SiGe and Si etch selectivity (ratio of 150:1), the GAA process is extremely challenging. Compared to TSMC, which is entering the 3nm arena using the FinFET process, SEC is likely to face a disadvantage in terms of yield rate.

As a result of SEC’s woes, the memory semicon industry as a whole should benefit, with foundry competitors such as TSMC and GFS in particular to enjoy related effects. In the case of memory semiconductors, low supply growth is likely to sustain amid the slow migration of number-one player SEC towards smaller processes. In addition, foundry capex growth should slow as SEC adjusts its investment speed.



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