Quote:To put things into perspective, though, Fab 14 B is one of TSMC's Gigafabs, which have a rated monthly output of 100k wafers - so production worth between three and ten days could be affected already, with the additional downtime accruing lost potential fabrication. This event isn't expected to significantly affect availability of any of the products for any of the companies, but these are becoming, at the very least, late inventory - this could well play into some speculative increases in pricing from some players in the market.

Quote:The incident supposedly occurred at Fab 14 in Nanke Technology Park. The loss of tens of thousands of wafers — if that figure is accurate (and we’re trusting Google with the mechanical translation) — would represent a significant chunk of a typical fab’s monthly output. It could even encompass the entirety of a fab’s output for that period of time, depending on just how many wafers “tens of thousands” actually refers to. Supposedly chemicals were used in the manufacturing process that were either inappropriately purified or simply the wrong product.

TSMC has not yet made an announcement about the scope or scale of the impact. While Nvidia issued an earnings warning today (we’ll take that up separately), they did not mention any reports of damage to TSMC in the document. This is a very serious claim, but the exact impact and overall contours remain unclear.

AMD shouldn’t be affected by any of these issues, assuming they remain confined to 16/12nm, though they might theoretically impact supplies of the Xbox One X and PS4 Pro depending on which wafer runs were specifically impacted. AMD currently uses TSMC at the 7nm node for its upcoming Ryzen CPU and Navi GPU, as well as the imminent Radeon VII. Its 14nm products are built at GlobalFoundries, including Polaris and Vega GPUs. AMD’s 28nm graphics cards (if any are still in production) are built at TSMC, but this problem is supposed to be specific to the 14/16nm product line.

Quote:TSMC said that the defects were due to a problematic batch of a photoresist material that contained a specific component that was abnormally treated by a chemical supplier. The treatment created a foreign polymer in the photoresist material that affected 12/16nm wafers at TSMC’s Fab 14B.

To protect its customers, TSMC removed a higher number of defective wafers than expected when it first learned about the problematic batch. The company expects the incident to reduce TSMC’s revenues for the first quarter by $550 million. However, the company expects to recuperate the loss in the second quarter.

The company has also moved some Q2 production into Q1. Therefore, the $550 million loss in the first quarter due to the bad batch is expected to be offset somewhat by an additional $230 million in revenue that was initially expected in Q2.