Fueled by the advancement in TSMC’s N3 process technology, the average selling price (ASP) of TSMC’s 12-inch wafers increased to USD 6,611 in the fourth quarter of 2023, registering a year-on-year growth of 22% despite the subdued semiconductor market.

According to a report by TechNews, Bernstein Research has indicated that the current growth in most semiconductor industries stems from the increase in pricing rather than a rise in chip shipment volumes.

As per a report by Tom’s Hardware, the wafer shipment volume of TSMC serves as evidence in many aspects. In the fourth quarter of 2023, TSMC’s shipment of 12-inch wafers was 2.957 million units, lower than the 3.702 million units in the fourth quarter of 2022. This marks the first time since 2020 that TSMC’s 12-inch wafer shipments have fallen below 3 million units. However, the revenue showed only a marginal decline.

Despite a significant 20.1% decrease in the fourth-quarter shipment volume of TSMC’s 12-inch wafers compared to the previous year, the revenue for the quarter reached USD 19.62 billion, only a 1.5% decrease from USD 19.93 billion in the fourth quarter of 2022.

Meanwhile, the average price of TSMC’s processed 12-inch wafers in the fourth quarter of 2023 reached USD 6,611 per unit, surpassing the USD 5,384 per unit in the fourth quarter of 2022. This is attributed to the increased shipment volume of wafers at the N3 process to customers, including Apple.

The report further cites sources indicating that TSMC may charge up to USD 20,000 per wafer manufactured using its N3 process. Although this figure may not be entirely accurate as TSMC’s pricing depends on various factors, the key point is that TSMC’s fees for the N3 process are higher compared to the N4/N5 or N6/N7 process.

Therefore, it can be argued that TSMC’s increase in manufacturing prices for process nodes has played a significant role in driving almost all growth in the semiconductor industry in recent years.

In essence, as time progresses, new process nodes will become increasingly expensive. The total chip shipments from 2019 to 2023 have actually decreased, but the ASP has significantly increased.

In particular, TSMC’s wafer revenue for the fourth quarter of 2023 was notably influenced by its N3 process, contributing 15%, while the N5 and N7 process contributed 39% and 17%, respectively.

This breakdown signifies that the N3 process node generated USD 2.943 billion in revenue for TSMC, the N5 process contributed USD 6.867 billion, and the N7 process brought in USD 3.3354 billion.

Overall, TSMC’s advanced process (N7, N5, N3) accounted for 67% of its total wafer revenue. Among these, revenues from System-on-Chip (SoC) used in smartphones and high-performance computing applications each constituted 43%, automotive chip revenue made up 5%, and IoT chip revenue contributed 5%.

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• [News] TSMC’s N3P to Enter Mass Production in the Second Half of Next Year, Rumored Inclusion of Tesla in Customer List

(Photo credit: TSMC)

TSMC, the world’s leading foundry in the 3nm technology, is reportedly experiencing a surge in the number of New Tape-Outs (NTOs) for the 3nm family in 2024, with Clients such as MediaTek, AMD, NVIDIA, Qualcomm, and Intel.

Among the 3nm family, the N3P process, set for mass production in the second half of 2024, is also making significant progress. Rumors suggest that Tesla has been added to the list of customers, with plans to utilize the N3P for the production of next-generation Full Self-Driving (FSD) chips after its launch.

Currently, Tesla has placed orders with TSMC for numerous chips related to electric vehicles. For instance, the supercomputer chip “D1” is utilizing TSMC’s 7nm technology along with advanced packaging processes.

Reportedly, according to industry sources, Tesla’s older FSD chips were initially produced using Samsung’s 14nm process, later upgraded to Samsung’s 7nm process. Subsequently, considering design upgrades, production quality, and scale, Tesla has shifted its HW 4.0 autonomous driving chip production to TSMC, utilizing the 5nm technology family.

The latest information per the report indicates that Tesla has recently initiated a NTO process with TSMC, planning to utilize the N3P for the production of the fifth generation of self-driving vehicle chips. Market expectations are high, with the influx of relevant orders suggesting that Tesla has the potential to become one of TSMC’s major clients.

According to TSMC’s previously disclosed process roadmap, the N3P process is an advanced version within the 3nm family, scheduled for production in 2024. Compared to the N3E, the N3P boasts a 5% improvement in performance, a 5% to 10% reduction in power consumption, and a 1.04 times increase in chip density.

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• [News] Intel CEO Indicated Intel’s 18A Slightly Ahead of TSMC’s N2
• [News] Intel’s Next Gen CPU to Produce at TSMC with 3nm in First Half of Next Year

(Photo credit: TSMC)