Christo Robin

[Exclusive] Samsung Foundry 2nm Yield at 55%… Stuck Below the 'Mass Production 60%' Threshold Samsung Electronics' foundry business — a key future growth engine — has hit a wall at the '60% mass production' threshold for its 2nm (nanometer; 1nm = one-billionth of a meter) process. With yields stuck in the mid-50% range and failing to enter stable mass production territory, effective yields are expected to drop to the 40% range once back-end processing is factored in. While the company has succeeded in achieving technical entry, the consensus is that it remains insufficient to win orders from global Big Tech clients. According to semiconductor industry sources on the 13th, Samsung Electronics' foundry division's average yield for the 2nm process is understood to be approximately 55%. This is lower than the '60%-plus' estimates floated by some, signaling that additional time is still needed to reach mass production stability. A source with knowledge of internal affairs stated, "The 2nm process yield is in the 50–60% range, with an average around 55%," adding, "The process is running, but it is still a long way from a stable mass production phase." The pace of yield improvement itself has been rapid. Samsung's foundry 2nm yields were reportedly stuck in the 20% range as recently as the second half of last year. Reaching the mid-50s in less than a year is assessed as technically reaching a level where the mass production line can be operated. This is attributed in part to the accumulation of process experience driven by incoming orders for Bitcoin mining chips from China's Canaan and MicroBT, among others. Given the extreme difficulty of the 2nm ultra-fine process, some consider this an exceptionally fast rate of improvement. However, the prevailing view in the industry is that it remains a "half-process" at best. In a structure where nearly half of all wafer input is discarded as defective, the process fails on both price competitiveness and delivery reliability. In particular, when factoring in losses from performance binning and packaging, the actual percentage of chips that can generate profit is estimated to fall as low as 40%. Considering that a single wafer for cutting-edge processes costs tens of millions of won, a 1% difference in yield translates to annual operating profit differences ranging from hundreds of billions to trillions of won. This is bound to significantly derail Samsung Electronics' efforts to improve foundry business profitability. An industry source said, "A yield in the 50% range only means the process 'runs' — it is not a stage where customers can entrust orders with confidence," adding, "It is a zone where both delivery and quality variability coexist." By contrast, rival TSMC is reported to have secured stable yields of 60–70% for its 2nm process. Samsung Foundry's current mid-50% yield is therefore assessed as corresponding to the technical entry stage, but falling short for securing major customers — a "transitional zone." Significant progress has been made, but analysis suggests actual mass production remains premature. In practice, Samsung has secured some customer and internal volumes, but has yet to achieve results in winning key clients such as Apple, NVIDIA, and AMD. Notably, Qualcomm — a global mobile application processor (AP) company that had raised expectations for new orders — is also showing signs of returning to TSMC, citing process yield and stability concerns. Additionally, the 'AI6' advanced autonomous driving chip contracted with Tesla is scheduled for mass production this year, and the yield level achieved at the actual production milestone will be critical in determining profitability and supply stability. Meanwhile, Samsung Electronics' strategy is to win new orders, run its facilities, and improve yields going forward. At Samsung Electronics' annual general meeting on March 18, Han Jin-man, head of the foundry business division (President), stated, "For the 2nm process as well (which is at a higher level than the 4nm process), we can build up order experience with major companies and secure yields through that process." $INTC $TSM

[Exclusive] Samsung Foundry 2nm Yield at 55%… Stuck Below the 'Mass Production 60%' Threshold Samsung Electronics' foundry business — a key future growth engine — has hit a wall at the '60% mass production' threshold for its 2nm (nanometer; 1nm = one-billionth of a meter) process. With yields stuck in the mid-50% range and failing to enter stable mass production territory, effective yields are expected to drop to the 40% range once back-end processing is factored in. While the company has succeeded in achieving technical entry, the consensus is that it remains insufficient to win orders from global Big Tech clients. According to semiconductor industry sources on the 13th, Samsung Electronics' foundry division's average yield for the 2nm process is understood to be approximately 55%. This is lower than the '60%-plus' estimates floated by some, signaling that additional time is still needed to reach mass production stability. A source with knowledge of internal affairs stated, "The 2nm process yield is in the 50–60% range, with an average around 55%," adding, "The process is running, but it is still a long way from a stable mass production phase." The pace of yield improvement itself has been rapid. Samsung's foundry 2nm yields were reportedly stuck in the 20% range as recently as the second half of last year. Reaching the mid-50s in less than a year is assessed as technically reaching a level where the mass production line can be operated. This is attributed in part to the accumulation of process experience driven by incoming orders for Bitcoin mining chips from China's Canaan and MicroBT, among others. Given the extreme difficulty of the 2nm ultra-fine process, some consider this an exceptionally fast rate of improvement. However, the prevailing view in the industry is that it remains a "half-process" at best. In a structure where nearly half of all wafer input is discarded as defective, the process fails on both price competitiveness and delivery reliability. In particular, when factoring in losses from performance binning and packaging, the actual percentage of chips that can generate profit is estimated to fall as low as 40%. Considering that a single wafer for cutting-edge processes costs tens of millions of won, a 1% difference in yield translates to annual operating profit differences ranging from hundreds of billions to trillions of won. This is bound to significantly derail Samsung Electronics' efforts to improve foundry business profitability. An industry source said, "A yield in the 50% range only means the process 'runs' — it is not a stage where customers can entrust orders with confidence," adding, "It is a zone where both delivery and quality variability coexist." By contrast, rival TSMC is reported to have secured stable yields of 60–70% for its 2nm process. Samsung Foundry's current mid-50% yield is therefore assessed as corresponding to the technical entry stage, but falling short for securing major customers — a "transitional zone." Significant progress has been made, but analysis suggests actual mass production remains premature. In practice, Samsung has secured some customer and internal volumes, but has yet to achieve results in winning key clients such as Apple, NVIDIA, and AMD. Notably, Qualcomm — a global mobile application processor (AP) company that had raised expectations for new orders — is also showing signs of returning to TSMC, citing process yield and stability concerns. Additionally, the 'AI6' advanced autonomous driving chip contracted with Tesla is scheduled for mass production this year, and the yield level achieved at the actual production milestone will be critical in determining profitability and supply stability. Meanwhile, Samsung Electronics' strategy is to win new orders, run its facilities, and improve yields going forward. At Samsung Electronics' annual general meeting on March 18, Han Jin-man, head of the foundry business division (President), stated, "For the 2nm process as well (which is at a higher level than the 4nm process), we can build up order experience with major companies and secure yields through that process." $INTC $TSM