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Samsung rival TSMC profit declined in Q2, first time in four years
The global economic slowdown is not only affecting Samsung but also other firms in the industry. TSMC has a lead over Samsung Foundry in the international semiconductor market, but it also faced a profit decline in Q2 2023 for the first time in four years.
Below you can check the Q2 2023 business results of TSMC:
- Revenue: 480.84 billion New Taiwan dollars ($15.68 billion), vs. NT$478.83 billion expected
- Net income: NT$181.8 billion, vs. NT$172.55 billion expected
The revenue decline of TSMC is 10 percent from a year ago to NT$480.84 billion, while net income fell 23.3% from a year ago to NT$181.8 billion. Earlier, the Taiwanese chip manufacturer forecast second-quarter revenue between $15.2 billion and $16 billion.
In particular, TSMC’s second-quarter revenue was $15.68 billion, decreased 13.7 percent year-over-year and 6.2 percent quarter-over-quarter. Besides, the gross margin for the second quarter was 54.1 percent, the operating margin was 42.0 percent, and the net profit margin was 37.8 percent.
This is TSMC’s first quarterly downfall since the second quarter of 2019, marking the end of four years of robust growth. The company disclosed its 5nm products accounted for 30 percent, 7nm for 23 percent, and other advanced tech for 53 percent of the total wafer revenue.
“Our second quarter business was impacted by the overall global economic conditions, which dampened the end market demand, and led to customers’ ongoing inventory adjustment,” said Wendell Huang, VP and Chief Financial Officer of TSMC. “Moving into the third quarter 2023, we expect our business to be supported by the strong ramp of our 3-nanometer technologies, partially offset by customers’ continued inventory adjustment.”
Forecast for Q3:
The chip maker also forecasted third-quarter revenue to draw between $16.7 billion and $17.5 billion.
Samsung Electronics named a new CFO and announced plans to establish an AI Center for the future. The company has also strengthened AI R&D and deployed R&D personnel to the site to strengthen communication.
According to the info, Samsung appointed Park Soon-cheol as the CFO of the DX Division and unveiled the AI Center. As the chip process competition has intensified, Samsung has taken this special measure to build a foundation.
As the business environment surrounding Samsung is not easy, the message is that it will strengthen its internal stability. The DS division in charge of semiconductors significantly strengthened:
- AI research functions
- Established a responsible development system
- Implemented follow-up personnel
- Reorganization in the direction of integrating
- Development and support organizations.
The new Chief Financial Officer will coordinate communication between each business department and top management, and efficiently manage business strategies and financial operations.
The new AI center will be led by Vice President Song Yong-ho. VP Song plans to lead over 60 people to develop next-gen storage devices and lead technological innovation given the AI era.
In addition, the system LSI division appointed Vice President Choi Jin-hyuk as the head of the SoC business team. Vice President Choi plans to lead the development of application processor (AP) chips, which are Exynos.
Apart from this, Samsung has also divided the Foundry Division into two categories: Manufacturing and Technology. Technical organizations such as production process (Fab) and cleaning and diffusion were placed under the subsidiary.
- The message is for R&D personnel to communicate directly on the spot.
Samsung announced it’s honoring 300 public middle and high schools from all 50 states across the US as State Finalists in the 15th annual Samsung Solve for Tomorrow national STEM (Science, Technology (AI), Engineering, and Mathematics) competition.
The company will award over $2 million in prizes to 2024’s participating schools. For now, each State Finalist school has won a $2,500 Samsung technology prize package.
This is an initial milestone on the path toward becoming one of three National Winners that will each unlock $100,000 for their school.
- The full list of State Finalists can be viewed here.
“These State Finalist teams are answering that call by engaging technology for good, like their quick adoption of AI to power wide-ranging solutions that address not only pressing challenges in their communities but also global issues.” – Salman Taufiq, Director – Corporate Marketing, Samsung Electronics America.
Upcoming Competition Phases
Based on the activity plans, judges will select State Winners, who will be revealed in March 2025.
State Winners
50 State Winners will get a Samsung Video Kit to help create their “STEM solution pitch video,” along with $12,000 worth of Samsung technology.
One of the 50 State Winner schools will be recognized with a Sustainability Innovation Award for driving sustainable change through STEM innovation, and an additional $25,000 prize package, including Samsung ENERGY STAR technology.
From the 50 State Winners, one school will be selected for the Rising Entrepreneurship Award, receiving a $25,000 prize package to nurture and develop their STEM solution into a venture extending beyond the competition.
National Finalists
Based on their videos, 10 National Finalists will be chosen to participate in a live pitch event and present their project to a panel of judges. Seven of these schools will be awarded $50,000 in Samsung technology and classroom supplies.
From the National Finalists, one Community Choice Winner will be determined through online voting by the general public, winning an additional $10,000 in prizes.
One Employee Choice Winner will be selected by Samsung employees to receive $10,000 in prizes in addition to their National Finalist winnings.
National Winners
Judges will name three National Winners, each earning a $100,000 prize package.
Apple has reportedly requested Samsung to revamp the iPhone DRAM memory design to boost AI capabilities. The company is said to be working to switch to a discrete packaging method for the low-power DRAM used in iPhones.
TheElec reports that the new iPhone DRAM design change by Samsung aims to meet the growing need for memory bandwidth driven by on-device AI and foldable phones.
Samsung’s new discrete packaging method places memory independently next to the system-on-chip. It allows better heat dissipation and more I/O pins, potentially boosting AI capabilities.
Meanwhile, it may not fully meet the iPhone’s needs for low communication latency. The company is also likely to implement the next-gen LPDDR6-PIM standard for enhanced AI performance.
Apple Intelligence (Source – Apple)
As Mobile AI evolves, Apple seems to have realized the continuously increasing requirement of high bandwidth memory on the iPhone to seamlessly run AI tasks and generative processing.
That said, Apple has opted for discrete packaging, which it has used in Macs and iPads. This method ensures memory is placed alone next to the SoC, allowing for more I/O pins and flexibility.
In discrete packaging, there is a larger surface area for heat to dissipate, and the heat generated by the SoC and memory does not overlap, which is generated during generative AI processing.
Apple reportedly aims to switch iPhone LPDDR to a discrete package format starting in 2026. The company apparently plans to separate LPDDR DRAM memory from the system semiconductor.
Previously, LPDDR was vertically stacked on top of the system chip in the PoP configuration. It is used in mobile memory to enable smaller IC designs compared to horizontal packaging.