Qualcomm Snapdragon 8 Elite Gen 2 to Be Exclusively Manufactured on TSMC’s 3nm N3P Process, Samsung Reportedly Loses Production Bid

In a significant development within the semiconductor industry, TSMC is set to exclusively mass-produce Qualcomm’s Snapdragon 8 Elite Gen 2 for the upcoming year. This move highlights TSMC’s advanced lithography capabilities, particularly when compared to Samsung’s current manufacturing challenges. Although Qualcomm initially sought to incorporate Samsung into its supply chain to drive down costs, the Korean foundry has been grappling with yield issues associated with its 3nm GAA process, leading Qualcomm to revert to the more dependable TSMC.

Samsung’s Struggles to Secure Snapdragon 8s Elite Orders

TSMC’s promising results from its 2nm trial production, reportedly achieving a 60 percent yield rate, have likely instilled confidence in Qualcomm, prompting the chipset maker to consolidate its orders with TSMC. According to insights from The Bell, highlighted by the industry insider @Jukanlosreve, Samsung’s troubles extend beyond losing the Snapdragon 8 Elite Gen 2 orders. Early next year, Qualcomm plans to unveil the Snapdragon 8s Elite, a slightly less advanced variant of its flagship SoC, but it appears Samsung has not managed to secure any orders for this chip either.

This inability to acquire new orders signals severe setbacks for Samsung’s semiconductor division. The mass production of the Snapdragon 8 Elite Gen 2 will be carried out using TSMC’s enhanced 3nm ‘N3P’ technology, which promises notable improvements over the previous ‘N3E’ version. Qualcomm has been proactive, reportedly starting testing of the upcoming chipset earlier than expected to maintain competitive leverage against Apple’s forthcoming A19 and A19 Pro processors slated for the iPhone 17 lineup.

Both the Dimensity 9500 and Snapdragon 8 Elite Gen 2 chips are set to leverage ARM’s Scalable Matrix Extension (SME), which could enable up to a 20 percent enhancement in multi-core performance. However, the exclusive partnership with TSMC may compel Qualcomm to increase pricing next year, potentially squeezing profit margins for numerous smartphone manufacturers. Nevertheless, the need for Qualcomm to stay competitive in the rapidly evolving silicon landscape necessitates the development of cutting-edge processors.

As Samsung struggles to regain the confidence of key partners, Qualcomm’s ability to negotiate favorable wafer prices with TSMC is compromised, effectively sidelining the dual-sourcing strategy it once employed. To alleviate silicon costs, Qualcomm may need to rely on exceptional pricing strategies from MediaTek for its Dimensity 9500 offering.

For further details, visit The Bell.

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