Immense demand for TSMC’s 7nm silicon fabrication has forced the Taiwanese semiconductor manufacturing giant to triple the lead time on chip orders. While the effects likely won’t be felt for some time, it would mean production of AMD’s 7nm chips used for Ryzen 3000 CPUs and Navi GPUs (Radeon RX 5700 series) has been extended from two months up to six months.
The report comes from DigiTimes, who claim TSMC’s clients have been snapping up its 7nm production capacity in big numbers. TSMC’s foundries are working flat out but the strong demand from the likes of AMD and smartphone manufacturers now means TSMC is going to take three times longer to deliver on its orders.
Further down the line we can expect this to have a fairly large impact on AMD’s mid to long-term plans. While AMD likely has decent stocks of Radeon RX 5700 GPUs and Ryzen 3000 CPUs already, these could begin to dry up with the dramatically increased lead time. There’s also the 7nm+ fabrication to consider, which is set to debut in 2020 with the Zen 3 CPU architecture along with 7nm+ Radeon graphics and the RDNA 2 GPU architecture.
We could argue all day about whether the 7nm process has delivered on expectations but the bottom line is that it's now the base from which AMD’s current hardware is built. 7nm is the trump card through which AMD holds an advantage over Intel and its in-house fabrication woes, although this strength could soon become a weakness for Team Red.
For now, AMD is going to have to tread a little more carefully. 6-month lead times means AMD will be slower to react to increased demand, forcing AMD to hedge bets on larger orders.
One aspect we’d be really interested in here is what this means for the next-gen consoles. Both Microsoft and Sony are set to use 7nm AMD silicon for their Project Scarlett and PlayStation 5 consoles. There’s every chance these upcoming consoles, which are expected to launch in 2020, have directly contributed to TSMC’s massive backlog of orders. Sony and Microsoft will be asking for millions upon millions of these chips ready to go into consoles next year and probably won’t take too kindly to any long-term delays. TSMC had said it would be ready to ship its 7nm chips for the PlayStation 5 by Q3 2020 and it would certainly be a tough blow for Sony if it didn’t pull through with the order.
We would imagine this change to delivery lead times from TSMC only applies to orders taken after this announcement though, and there is the possibility that TSMC will expand its production capacity in due course.
Certainly something to keep an eye on then, as this change could bring about some hefty ramifications once we roll into 2020.