Author | Liu Gongchang
Recently, because of a certain country's suppression of Huawei chips, chips have become the hottest topic in China's industry, and chip-related companies have attracted widespread attention in the capital market. With the help of capital, "chip concept stocks" "Grown to astonishing heights.
Speaking of chip manufacturing companies, TSMC is undoubtedly the best company in the world today. This company has the most advanced chip production lines in the world. Every step forward by this company actually represents an advancement in human chip manufacturing. However, due to the U.S. chip technology ban, this company also participated in the operation to cut off supplies to Huawei.
What kind of company is TSMC? What is the situation like with domestic partners or peers? Not long ago, we published a focus on TSMC: Why do and Samsung lag behind? This article summarizes the decades of development of this company. Today, we will review the relationship between TSMC and three domestic companies.
The three companies are Tsinghua Unigroup , SMIC and Huawei.
Tsinghua Unigroup: Cooperation stops at propaganda
Let’s first look at the first company related to it: Tsinghua Unigroup. Below is an introduction to its official website.
was established on March 18, 1999, and was listed on the Shenzhen Stock Exchange on November 4 of the same year. In 2000, Tsinghua Unigroup's stock price hit a stock price of 106 yuan, becoming the 100-yuan stock leader in the Chinese stock market. Focus on the field of IT services, carefully build a "cloud-network-end" IT industry chain, comprehensively deepen the industry application of information technology such as cloud computing, mobile Internet and big data processing, and accelerate the progress towards a powerful IT service platform enterprise.
This company’s layout in the IT field mainly relies on acquisitions. In July 2013, it acquired chip design company Spreadtrum Communications for US$1.78 billion, and in July 2014, it acquired another chip design company, RDA Microelectronics, for US$910 million. On September 26, 2015, Tsinghua Unigroup introduced a US$1.5 billion investment from Intel to add new blood. Since then, its acquisitions have become even bolder: on October 30, 2015, it invested NT$19.4 billion (approximately 3.773 billion yuan) in Taiwan's Licheng Technology, the world's fifth largest packaging and testing service provider. Ziguang holds 25% of the shares of Licheng, making it the latter’s largest shareholder and has a board seat. In November, Ziguang publicly stated its intention to merge with MediaTek , another most influential semiconductor company in Taiwan.
In November, Ziguang Chairman Zhao Weiguo said, "If Taiwan's laws are willing to open up, I am willing to meet with MediaTek Chairman Tsai Mingjie immediately to facilitate the merger of Ziguang's Spreadtrum, RDA and MediaTek, and join hands to surpass Qualcomm ." In November On the 2nd, MediaTek Chairman Cai Mingjie responded to Ziguang's proposal and said, "As long as the policy permits, MediaTek is willing to adopt an open attitude and join hands with both sides of the Taiwan Strait to jointly enhance the status and competitiveness of Chinese companies in the semiconductor industry."
Although everyone with a discerning eye can see it. It can be seen that MediaTek's response was only polite (both parties said that the premise is that Taiwan's policies allow it), but Tsai Mingjie's statement still caused trouble. Some people believed that it was preparing to sell MediaTek to Ziguang. In response to this question, MediaTek Chairman Cai Mingjie also clearly denied it in an interview recently, saying that this was a misunderstanding. When he shouted to Ziguang last year, he agreed that the semiconductor industry on both sides of the Taiwan Strait should work together, and did not want to sell out MediaTek. It was because he did not have the opportunity to work properly before. Explain that many opposing scholars have proposed a "hypothetical" position of MediaTek, and now he needs to clarify it to the outside world.
The most explosive news was the acquisition of the world’s chip foundry giant TSMC in 2015. TSMC's electronic chip processing industry is the lowest link in the high-tech industry and is also the most basic.
In early November 2015, according to Taiwan's "Economic Daily" report, TSMC Chairman Zhang Zhongmou said that he had never met Zhao Weiguo, chairman of Unisplendour Group, but believed that Zhao Weiguo wanted to strengthen the supply chain through mergers and acquisitions.
Regarding the mainland Unigroup's frequent calls to invest in Taiwan's semiconductor industry, his personal attitude is open. However, the Taiwan authorities currently have restrictions on mainland investment in Taiwan in the chip design sector.
However, Zhang Zhongmou also said that in order to obtain control of TSMC, he must hold more than 25% of the shares. He believes that TSMC’s current market value is US$114 billion, which is similar to Samsung’s US$120 to 130 billion. To obtain 25% of TSMC’s equity, it will cost Nearly $30 billion.
Tsinghua Unigroup’s acquisition of TSMC has caused an uproar on the island.
According to C114, Hon Hai Chairman Terry Gou said that Zhao (Wei Guo) is just a stock investor. How can he ask TSMC Chairman Zhang Zhongmou, a world semiconductor godfather, how much the company will cost to sell? Zhang Zhongmou has more than 60 years of experience in semiconductors, "not something you can buy with money today." The shaping of corporate culture cannot be bought by a mainland company that speculates in stocks.
In the eyes of Terry Gou, the head of Foxconn , Tsinghua Unigroup, a mainland company that is so tall in the eyes of the Chinese people, is nothing but stock trading. Although his words may have certain elements, they also reveal a pattern of so-called independent chip development in mainland China led by Ziguang Group, that is, mergers and acquisitions with money piled up, and they never really want to calm down and do practical work. R&D.
According to a financial media report, when Zhao Weiguo returned to Ziguang Group as president in 2009, he did not focus on his current main business integrated circuits (including chips), but as integrated circuits will become an important national strategy As one of the directions, as well as the establishment of the National Integrated Circuit Industry Investment Fund with a total amount of 130 billion yuan, Zhao Weiguo's Tsinghua Unigroup immediately began to make a timely turn.
The subsequent mergers and acquisitions with the chip industry, especially the market (capital) effect of Ziguang suddenly standing in the spotlight, have to be said to be closely related to this. In fact, China National Integrated Circuit Industry Investment Fund stated at the beginning of this year that it would invest RMB 10 billion in Ziguang in the next five years.
Ziguang is more focused on mergers and acquisitions, or to be precise, it is developing China’s “core” through capital-encircling money models. (Terry Gou insinuated Zhao Weiguo's stock speculation: What is the difference between China Semiconductor and Sun Yongjie, November 26, 2015)
SMIC: It is difficult to gain a foothold in the lawsuit with TSMC
In 1999, Zhang Rujing, known as the "Father of Chinese Semiconductors", was Taiwan founded "World Semiconductor" and became the second largest semiconductor factory in Taiwan. Because it directly threatened the monopoly position of the boss "TSMC", TSMC bypassed Zhang Rujing and bought World University for US$5 billion.
Angry Zhang Rujing left Taiwan, China, and came to Shanghai with 300 engineers and an investment of 100 billion yuan. In 2000, SMIC was officially established. Many of SMIC's technical backbones came from Taiwan, China, including many TSMC technicians.
TSMC. Of course they won't let it go. In 2003, TSMC sued SMIC for stealing trade secrets in the United States, and accused SMIC of infringing on TSMC's patents by selling chips in California. In February 2005, the two parties reached a settlement and signed a six-month agreement. According to the agreement, SMIC agreed to pay a settlement amount of US$175 million, hand over TSMC’s trade secret documents, and stop using the technology and processes involved.
On August 25, 2006, TSMC announced this to the United States. The California court sued, accusing SMIC of violating the 2005 agreement and continuing to use TSMC's trade secrets to manufacture process products of 0.13 micron or below after 2005.
According to media reports, TSMC's attorney Jeffrey Chanin said that this case involved. 65 cases of theft of trade secrets. David Steuer, SMIC’s attorney, argued that the disputed information did not constitute a trade secret because it had been widely disclosed in technical documents.
According to SMIC’s third quarter report, the lawsuit against TSMC was reported. According to the disclosure of the progress, TSMC requested damages, injunction, attorney's fees and early payment of the remaining unpaid amount stipulated in the settlement agreement.
On September 12, 2006, SMIC countersued TSMC in the same court, alleging that TSMC breached the contract and violated the truth. Fair deal.
Subsequently, the two parties extended the lawsuit from the United States to Beijing, and launched a tug-of-war between litigation and counter-litigation in the Beijing Higher People's Court.Among them, on June 10, 2009, the Beijing High Court ruled in the first instance that it did not support SMIC’s lawsuit against TSMC.
At this time, SMIC not only faces a huge compensation of US$1 billion, but will also permanently lose the US market. This is undoubtedly a fatal blow to a chip foundry.
A few hours after Wang Ningguo officially took over, SMIC announced that it had reached a settlement agreement with TSMC. The contents included: first, both parties dropped all pending litigation charges; second, terminated SMIC’s 2005 The remaining payment liability of US$40 million in the settlement agreement; third, SMIC paid US$200 million to TSMC, which must be paid in installments before 2013; fourth, SMIC transferred 1.79 billion SMIC shares to TSMC ( Accounting for approximately 8% of the issued share capital), as well as warrants to subscribe for 695 million SMIC shares at a price of HK$1.3 per share, and the rights can be exercised within three years.
If the warrants are exercised, TSMC's shareholding in SMIC will reach 10%, becoming second only to Datang Telecom Technology Industry Holdings Co., Ltd. (holding 16.55%) and Shanghai Industrial (Group) Co., Ltd. ( The third largest shareholder holding 10.08% of shares. (SMIC’s Redemption Road Author: Time: 2009-11-24 Source: Electronic Products World)
It is said that TSMC also proposed an additional condition in this lawsuit, which is to let Zhang Rujing leave SMIC. The moment
received the lawyer's notice, Zhang Rujing burst into tears in front of the phone. On the third day, he resigned and vowed never to enter the semiconductor field again. (Since Yu is born, how can Liang be born? The battle of the century between TSMC and SMIC 202007/13 Red Ant Self-Media)
After Zhang Rujing sadly left, Wang Ningguo, the former global vice president and Asia president of Applied Materials, the world's largest semiconductor company, took over. SMIC. Wang Ningguo has set two strategies for SMIC: to avoid direct competition with TSMC and strive to make SMIC the "best alternative" for customers, that is, to be a spare tire for TSMC; to improve the local industrial chain and help local semiconductor equipment, Materials and chip design company development.
In 2010, SMIC achieved profitability for the first time in its history. The company's gross profit margin increased from 7.6% in the fourth quarter of 2009 to 23.9% in the fourth quarter of 2010. But after SMIC Chairman Jiang Shangzhou passed away suddenly, the company began to fight internally. In the end, the new chairman Zhang Wenyi strongly recommended Qiu Ciyun, the former "veteran" of SMIC, to be the CEO of SMIC.
The strategy proposed by Qiu Ciyun is to seek positioning differentiation and business diversification with international giants without directly confronting competitors. While pursuing differentiation, SMIC has also not neglected the research and development of more refined processes. Under the leadership of Qiu Ciyun, SMIC successfully achieved 28nm mass production in 2014. Although there is still a two-generation technology gap with the industry's cutting-edge level, this breakthrough also helped SMIC get its first mobile phone chip order - Snapdragon 410 from Qualcomm. (What is the gap between SMIC and TSMC? Published on 2020-09-08)
Since 2010, due to National Semiconductor’s strategic layout, many state-owned enterprises have invested in SMIC. As of 2019, the top three shareholders of SMIC are Datang Telecom, accounting for 17%, the National Integrated Circuit Industry Fund, accounting for 15.7%, and Tsinghua Unigroup, accounting for 7.4%. At this point, SMIC has got rid of TSMC. control and become a real mainland Chinese company.
In 2017, SMIC CEO Qiu Ciyun resigned. Later, he left TSMC and fled to South Korea, and was employed by Samsung. In the end, he was sued twice by TSMC. The lawsuit failed miserably and he was forced to flee South Korea to become the CEO of SMIC. It only took about a year and a half to upgrade SMIC from a 28-nanometer process to a 14-nanometer process and achieve mass production, with the yield rate increasing from 3% to 95%.
The 14nm node will be mass-produced in the second half of 2019. The N+1/N+2 process is currently progressing smoothly, and the 5nm process is planned to be implemented within 4 years. There is a gap in the second-generation process with TSMC.
At a critical moment, news came out that the United States would impose sanctions on SMIC.
html On the evening of September 5, SMIC issued a statement stating: As an internationally operating integrated circuit manufacturing company listed on the Hong Kong Stock Exchange and mainland China A-shares, SMIC strictly abides by the laws and regulations of relevant countries and regions. On this basis, it has been operating legally and in compliance with regulations; and has established good cooperative relationships with many well-known American and internationally renowned semiconductor equipment suppliers for many years. The U.S. Department of Commerce has also issued approvals for equipment imported and purchased by SMIC over the years. Several important export licenses. At the same time, SMIC has been an important member of the global semiconductor supply chain since its establishment, with customers all over the world including the United States, Europe, and mainland China. Its products and services are used for civilian and commercial purposes, and it has never had any business activities involving military applications. , has nothing to do with the Chinese military; in 2016 and before, SMIC was still a "Validated End-User" officially recognized by the U.S. Department of Commerce, and many U.S. Department of Commerce officials visited SMIC on-site International interviews.
"Therefore, any reports about 'SMIC's involvement in the military' are false news, and we are shocked and puzzled by this. SMIC is willing to communicate with relevant U.S. government departments in a sincere, open and transparent manner. communication to resolve possible differences and misunderstandings," SMIC wrote in the statement.
At this year’s first quarter financial report, SMIC Co-CEO Zhao Haijun pointed out: "SMIC is an international company. Over the past 20 years, we have maintained good communication with our suppliers and the U.S. Department of Commerce. , and we abide by the rules and are fully compliant. We have promised not to be involved in the military business since its establishment, and it is the same now. "
Unlike Huawei's hard resistance, SMIC put itself lightly in the face of the threat of U.S. sanctions from the beginning. Very low. This has aroused dissatisfaction among a group of little pinks who grew up watching Huawei's heroics. In fact, SMIC, which bears the burden of the rise of China's chips, has been ill-fated, and its development is still in great uncertainty. According to people familiar with the matter, SMIC’s dependence on U.S. equipment manufacturers exceeds 20%, which is higher than that of TSMC. High profile can kill people.
TSMC and Huawei: Unable to withstand U.S. pressure, they worked overtime to produce
In May this year, the U.S. Department of Commerce issued new export control regulations for Huawei, comprehensively restricting Huawei from using U.S. EDA software to design chips, and restricting foundries that use U.S. technology. Huawei makes chips. In order to avoid impact on relevant companies, a 120-day buffer period was given, which means that the ban will take effect in September.
The second restriction seems to be specifically for TSMC. The U.S. Department of Commerce has not specified the evaluation standard for 25% U.S. technology content. Therefore, some observers believe that TSMC’s equipment relies heavily on U.S. technology and it is difficult to exceed 25%.
Although orders from Huawei accounted for 14% of TSMC's total business in 2019, at the performance conference on July 16, TSMC announced that after September 14, 2020, TSMC will no longer continue to supply Huawei. goods chips.
TSMC Chairman Liu Deyin said at the meeting that in the short term, the inability to supply Huawei will have an inevitable impact on TSMC. TSMC is actively cooperating with other customers to fill the vacancies left by Huawei. Obviously, "cutting off supply" to Huawei is a helpless move by TSMC.
The impact of supply cuts on Huawei is inestimable. On August 7, at the China Information Technology Conference 2020 Summit, Yu Chengdong, the always high-profile Huawei consumer business CEO, said in his keynote speech that the Kirin 9000, which will be launched this fall, may be Huawei's high-end chip.
Due to the second round of US sanctions, Huawei's chip production can only accept orders before May 15th, and production will end on September 15th. So this year may be the end of Huawei’s Kirin high-end chips.
TSMC hasn’t given up yet, let alone being “let go”. On the contrary, TSMC is also preparing to deliver more chips to Huawei by coordinating the supply needs of the supply chain. According to reports from the Global Times and other media, TSMC is working 24 hours a day to urgently produce more chip stocks for Huawei to prepare for supply interruptions.
If TSMC is as reported by the media, it seems that Huawei will receive more than 8 million chips. In fact, in the eyes of some professionals, Huawei will receive 10 million chips. Analyst Huang Haifeng revealed that Huawei chips will cover more than 10 million high-end mobile phones, which is enough for Huawei to support shipments for half a year.
Although the number has increased from 8 million to 10 million, of which only 2 million have changed quantitatively, when Huawei's mobile phones are facing a comprehensive decline and no one can help, TSMC is undoubtedly the most reliable company. Huawei's Kirin chips use a 5nm process, and with such technology, TSMC has no shortage of shipping ports. You must know that Apple's new phone opposite is also preparing for release, and it can rush to produce chip stocks for Huawei as soon as possible in a few days before the deadline. , TSMC has tried its best.
A very cruel question is currently facing us: without TSMC, how long can Huawei's inventory last? In May 2020, Huawei's rotating chairman Guo Ping pointed out at Huawei's global analyst meeting that due to unconventional reasons, Huawei's R&D investment and inventory increased significantly, including R&D investment of 131.7 billion euros, an increase of 29.8%, and inventory investment of 167.4 billion. Euro, up 73.4%.
According to Huawei's financial data, Huawei's inventory continued to rise significantly in 2019 and the first quarter of 2020, with an increase of more than 73.5% in 2019. As of the end of the first quarter of 2020, Huawei's inventory has reached 188.247 billion yuan.
Previously, Huawei used the 120-day buffer period to place a large number of 7nm and 5nm orders with TSMC, amounting to US$700 million. All Kirin chips will be delivered before the end of 2020 by September 15. The public financial reports of well-known foreign chip companies show that Huawei has purchased a large number of central processing units (CPUs) from Intel Corporation and for servers, and programmable chips from Xilinx Corporation. These chips are the most important components of Huawei's base station business and emerging cloud business. Huawei has enough inventory to last for one and a half to two years.
According to predictions by relevant people, with the large-scale shipment of Huawei's 5G-related equipment, Huawei's chip inventory may only be maintained until the beginning of 2021. To sum up, if TSMC cuts off supply, Huawei and Chinese companies will have less than two years to achieve domestic replacement that is completely independent of American equipment and technology. If we realize domestic substitution in this period, Huawei will encounter very big difficulties. Because the semiconductor industry is developing at a rapid pace, we cannot rely solely on inventory chips to develop new products, and the inventory is limited.
Why does Huawei have to rely on TSMC?
Guo Ping, Huawei’s rotating chairman, has already answered this question: As an ICT equipment and terminal company, Huawei can design products and integrate circuits, but we do not have capabilities beyond that.
Giving up on TSMC and turning to Samsung and MediaTek to buy chips may be a way out, but Samsung and MediaTek also use a lot of American technology and equipment in their manufacturing, and they also face great uncertainty in the future.
It can be seen that in the future, Huawei's chip manufacturing may only rely on mainland China. At present, among domestic chip foundry manufacturers, only SMIC has some hope.
Can SMIC be able to bear the chip supply burden of Chinese companies including Huawei? As far as the current situation is concerned, SMIC, as the strongest chip manufacturer in mainland China, can only produce 14nm (nanometer) chips and cannot produce higher-end 7nm and 5nm chips. Not only are the products two generations apart, but they have not yet achieved large-scale production. mass production. Therefore, it is impossible to supply the latest 5nm chips that Huawei needs.
How far is the distance between SMIC and TSMC?
html According to news on September 10, TSMC announced its August revenue, with consolidated revenue of NT$122.878 billion, approximately US$4.2 billion. The revenue in January exceeded that of SMIC in a year - the latter's revenue in 2019 was also Less than $3.2 billion. Let’s talk about the specific situation.
Market share
According to the Nikkei Asian Review, TrendForce recently released the latest statistics. In the global wafer foundry market in the second quarter of 2020, TSMC's market share reached 51.5%, still ranking first in the world.SMIC ranks fifth in the world with a market share of 4.8%.
From the perspective of market share, based on global sales in 2019, TSMC’s market share is close to 50%, far exceeding Samsung (18%). SMIC is in the second echelon, with a market share of only 5.1%.
Profitability
TSMC achieved a net profit of US$11.5 billion in 2019, a net profit margin of 32%, a return on equity of 21%, a long-term gross profit margin of 47%-50%, and an operating net cash flow of US$20.5 billion. The main reason is that Advanced process nodes are highly profitable. TSMC has the largest share (more than 80%) in advanced nodes and enjoys exclusive industry profits. On the other hand, TSMC has a comprehensive process library, a short development cycle, and relatively higher process stability.
SMIC's 2019 financial indicators
In 2019, SMIC achieved a net profit of US$235 million, a net profit margin of 5.1%, a return on net assets of 4.14%, and a gross profit margin of 7.89%. The technological gap determines the disparity in profits. TSMC is at an advanced node (such as 7nm) can maintain a gross profit margin of more than 50%. However, for SMIC, which has a high revenue share of technology nodes 90nm and above, the gross profit margin is relatively low, and SMIC is entering the advanced process technology In the early stage, it faced greater loss pressure. These factors restricted SMIC's profitability.
Technology Gap
TSMC has an 86% market share in the 7-nanometer and 10-nanometer nodes, with operating revenue of US$12 billion, and a revenue contribution of 36%. It has an 83% market share in the 14-nanometer node, with a revenue of US$7.5 billion. , revenue contribution is 21%. In advanced technology nodes, TSMC is in a monopoly position in the industry.
SMIC has not yet broken through the 7-nanometer and 10-nanometer technology nodes, and it cannot buy the most advanced EUV lithography machines, so its revenue and market share are zero. At the 14-nanometer node, revenue was US$10 million, and revenue The revenue contribution of SMIC is 0.3%, and the market share is only 0.1%. SMIC’s largest revenue is the 90 nanometer and above process, with revenue of US$1.7 billion, revenue contribution of 51%, and market share of 8%.
In terms of advanced manufacturing technology, there is a big gap between SMIC and TSMC. TSMC is the monopoly and SMIC has not yet fully started.
TSMC 5nm node: It has entered mass production in mid-2020. Compared with 7nm, the logic density gain is 80% and the speed gain is 20%. EUV lithography machines are widely used in the 5nm process. It is expected to be driven by mobile/HPC. Real estate capacity will ramp up quickly and smoothly in the second quarter of this year, and 5nm is expected to contribute 10% of TSMC's revenue in 2020.
Advanced process layout progress of various fabs
TSMC 3nm node: It will enter risk production in 2021, and aims to achieve mass production in the second half of 2022. In the initial stage, 3nm will still use FinFET process, and it will switch to late 3nm or 2nm after maturity. GAA transistor technology.
SMIC 14-node: mass production in the third quarter of 2019, marking a breakthrough in the FinFET structure. FinFET structures will continue to be used until 5 nanometers or even 3 nanometers.
N+1 (8nm): Entering the customer signing stage, mass production is expected from the end of 2020 to early 2021, without EUV lithography equipment. N+2 (7 nanometer): Under development, relevant R&D lines have been established. (Understand the real gap between SMIC and TSMC in one article Hu Yikan Published on: 07-07)
Before TSMC’s 3nm chips have begun mass production, the construction of a 2nm process R&D center has begun. This R&D center will have an advanced production line and be supported by 8,000 engineers. In order to cooperate with the research and development of the 2nm process, TSMC was also revealed to have purchased two lithography machines at once. TSMC predicts that they have installed about 50% of the world's activated lithography machines.
According to foreign media estimates, the company's full-year capital expenditure in 2020 will further increase, reaching about 16 billion US dollars. What's even more incredible is that a TSMC executive also revealed online that TSMC has begun to use artificial intelligence and machine learning technology, mainly for data processing in the chip production process.
"Moore's Law" in the semiconductor industry states that the number of transistors that can be accommodated on an integrated circuit will double approximately every 24 months. In other words, processor performance doubles every 2 years.Calculated in this way, TSMC, which has achieved mass production of 5nm chips, is almost 6 years ahead of SMIC in technology. How easy is it to catch up with the pace that has fallen in the past six years? Moreover, this does not include the speed at which TSMC is also galloping forward.
At the same time, there are some technical shortcomings that mainland companies have been unable to overcome.
Combining ASML’s statement and TSMC’s internal purchasing orders, TSMC predicts that the company has installed approximately 50% of the world’s activated lithography machines. SMIC does not have one.
If SMIC cannot obtain extreme ultraviolet lithography machines (EUV), the company's chip production process will be stuck at the 7/8nm level. EUV lithography machines used to produce 7-nanometer and more advanced process chips are currently only produced by ASML in the Netherlands.
However, due to the existence of the Wassenaar Agreement and multiple interventions by the United States, the company was not sold to a Chinese company, and SMIC spent US$120 million and 2 years on lithography machines for nothing.
TSMC founder Zhang Zhongmou said: "You have accumulated a lot of experience, which brings you opportunities to innovate and reduce costs. If you take advantage of this opportunity, you will continue to be ahead of your competitors in terms of technology and cost reduction." (TSMC controls 50% of the world's lithography machines. Will the future of high-end chip manufacturing have nothing to do with mainland China? Lithography Machines 2020-09-02 · Gelonghui)
Note that the reason why TSMC can always stay on top of the wave is because it insists on focusing This industry spends approximately tens of billions of dollars investing in this industry every year to maintain a competitive advantage. Taking AMD as an example, the reason why it can erode Intel's near-monopoly in the server chip market is TSMC's new shrinking process.
's continued and high investment in R&D has also put pressure on SMIC. Its net profit attributable to the parent company after non-deductible expenses in 2019 even suffered a loss, with the loss amounting to 1.25 billion yuan.
At the same time, according to financial data over the years, SMIC's operating income growth seems to have stagnated from 2017 to 2019.
Core Thought Research Institute data shows that SMIC’s capital expenditures in 2020 will further increase, and the growth rate will reach 55% compared with 2019, which will set a record for the highest capital expenditures in the company’s history.
Due to its full production capacity, SMIC stated at its previous performance briefing that in order to respond to customer needs, the company will continue to expand its production capacity and seize market opportunities and growth. (TSMC "cut off supply" and Huawei urgently stockpiled 188 billion yuan! How long can it last? 2020-07-1807:13:52 Source: Panorama Financial Report)
At present, with its advanced process and packaging technology, TSMC occupies the supply of relevant advanced equipment Commercial resources have formed a barrier, coupled with the strength of grabbing orders, TSMC is firmly digging into the moat while maintaining its leadership in wafer foundry.
The later SMIC shouldered the expectations of the Chinese people. In addition to the fact that the technological gap is still far away, the turbulent external environment has added more uncertainty to this catch-up. But there is one thing I think SMIC did right, that is, keep a low profile and act in a high profile.
