How Will Samsung Respond to TSMC’s Massive Investment Increase for 2-Nanometer Semiconductor Process – BusinessKorea
Taiwanese semiconductor giant TSMC is set to dramatically increase its investment next year to expand production capacity for its 2-nanometer (nm) process semiconductors, riding the wave of heightened demand fueled by the artificial intelligence (AI) boom. This escalation in investment appears necessary as Samsung Electronics is also preparing to compete intensely in the 2nm process field.
According to Taiwan’s United Daily News on July 1, citing sources, TSMC’s capital expenditure for next year is expected to be between $32 billion and $36 billion. This marks an increase of 12.5% to 14.3% from this year’s budget of $28 billion to $32 billion, making it the second-largest expenditure following the $36.29 billion invested in 2022.
The sources noted that the increased investment is due to continuous growth in research and development (R&D) costs for advanced processes, coupled with stronger-than-expected demand for the 2nm technology, prompting TSMC to upgrade its processes and introduce new production equipment. TSMC plans to commence mass production of semiconductors using the 2nm process starting next year.
Particularly noteworthy is TSMC’s plan to acquire around 60 extreme ultraviolet (EUV) lithography machines from the Dutch company ASML by next year, an investment totaling about $12.3 billion.
The recent surge in AI technology adoption has prompted key clients such as Apple, NVIDIA, AMD, and MediaTek to actively consider incorporating TSMC’s 2nm process products, further supporting the investment expansion.
Moreover, sources added that “TSMC plans to set up at least eight 2nm factories across Taiwan, including in the BaoShan area of the XinZhu Science Park in the north and the NanZi Science Park in Kaohsiung in the south.” On June 26, Kaohsiung City approved the construction of TSMC’s third 2nm process factory.
Starting with the 2nm process, TSMC will also introduce the gate-all-around (GAA) transistor technology. While maintaining the existing FinFET process for the 3nm technology, both TSMC and Samsung Electronics will adopt the GAA technology starting from the 2nm process. This move has garnered significant attention, especially as Samsung Electronics had previously implemented GAA technology from its first generation 3nm process.
Thus, a fierce competition, or “foundry bloodbath,” is anticipated next year over the 2nm process, with industry runner-up Samsung Electronics opting to focus on the 2nm process rather than pushing limits with sub-2nm technologies.
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