TSMC Puts a Price on Their Production Accident

AlphaAtlas

AlphaAtlas

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Earlier this year, substandard chemicals forced Taiwan Semiconductor's Nanke 14 factory to shut down production after the company reportedly lost "tens of thousands of wafers." The production of cutting edge 16nm/12nm NVIDIA, MediaTek, and Huawei chips were reportedly affected by the incident, but TSMC didn't know the exact financial impact of the shutdown at the time. Now, Digitimes says "The incident is expected to reduce TSMC's first-quarter 2019 revenues by about US$550 million, gross margin by 2.6pp, operating margin by 3.2pp, and EPS by NT$0.42." The company also claims that the wafers scrapped in the first quarter "will be made up in following quarter," but the shutdown is still expected to impact their yearly financials as well.


TSMC said it discovered that a batch of photoresist from a chemical supplier contained a specific component which was abnormally treated, creating a foreign polymer in the photoresist that affected 12/16nm wafers at its Fab 14B. To ensure the quality of wafers delivered to customers, TSMC said they have decided to scrap a higher number of wafers than its earlier estimate... TSMC said it has maintained constant communication with customers affected by the incident, and has worked out replacement and delivery schedules with each of them.
 
Ouch...

I was wondering if this would possibly lead to a recall by the affected brands which utilized TSMC's fab, but I doubt they will.
 
gunbust3r said:
Half billion dollar oopsie. I'm guessing someone has a brand new job of running QC tests on chemicals before just throwing the jug into the machine now...
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In russia they would just blame the guy throwing the jug in...
 
nightanole said:
"employee has been disciplined"
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Makes me wonder what the fundamental differences of "discipline" is between closely related places like China and Taiwan. Does that mean every manager lined up and speed-bagged his ballsack, instead of getting shipped off to a Laogai?

Alas, half a billion dollars is one hell of a big hit, so it's going to be interesting to see how their plan for making up the wafer volume will pan out, because they're likely going to be cranking the production throughput straight to eleven.
 
gunbust3r said:
Half billion dollar oopsie. I'm guessing someone has a brand new job of running QC tests on chemicals before just throwing the jug into the machine now...
Click to expand...

To be fair, when you are purchasing from a trusted supplier you accept that they are responsible for all QC of that product. It's rare that QC is done on those items in house after purchase.

The *real* question is who screwed up, and whether TSMC has a mechanism to recoup damages from them.
 
gamerk2 said:
To be fair, when you are purchasing from a trusted supplier you accept that they are responsible for all QC of that product. It's rare that QC is done on those items in house after purchase.

The *real* question is who screwed up, and whether TSMC has a mechanism to recoup damages from them.
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Hope they have a well structured contract and it's not like USB-C chargers/cables. They blow up your $2000 device... Oh well, you can have a new replacement $40 charger.
 
Its crazy how expensive its getting to die shrink

What is it now just Intel and TSMC that have the tech to go 10nm or smaller now?
 
gamerk2 said:
To be fair, when you are purchasing from a trusted supplier you accept that they are responsible for all QC of that product. It's rare that QC is done on those items in house after purchase.
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That depends on the industry perhaps, but it certainly is not universally true. In my industry everything is tested in house and whenever we get chemicals from Chinese suppliers they often fail no matter how "trusted".
 
Galvin said:
Its crazy how expensive its getting to die shrink

What is it now just Intel and TSMC that have the tech to go 10nm or smaller now?
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Samsung and TSMC for now. Intel is not quite there yet.
 
gamerk2 said:
To be fair, when you are purchasing from a trusted supplier you accept that they are responsible for all QC of that product. It's rare that QC is done on those items in house after purchase.

The *real* question is who screwed up, and whether TSMC has a mechanism to recoup damages from them.
Click to expand...

Paul_Johnson said:
That depends on the industry perhaps, but it certainly is not universally true. In my industry everything is tested in house and whenever we get chemicals from Chinese suppliers they often fail no matter how "trusted".
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We require full inspection reports from all our vendors, and then we recheck all the critical dimensions once the parts are in house. Even with only US foundries and machine shops, the number of "mistakes" that are good on the vendor report much higher than zero. Some vendors are, obviously, better than others, but we'd never just use a part as received (and these are all parts made custom for us, our designs, our prints)
 
At least that mess was on 12/16 nm lines, from which i don't have any immediate needs to buy something from.
 
Is NVidia 2080Ti problems made in this process, node and timeframe? Wonder if that explains the card's issues.
 
No.
Seem like they took out a massive amount of products to make sure no affected parts slipped thru, and out in there wild where it would just amplify the embarrassment.
 
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