The global surge in artificial intelligence (AI) demand has led to increased interest in not only advanced processes but also mature process products, including power management integrated circuits (PMICs) and power semiconductors. As a result, Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest foundry, is reportedly planning to raise prices for its mature process products.
According to the Economic Daily News on July 13, multiple semiconductor design companies have recently been notified by TSMC that it intends to increase prices for mature processes. The extent of the price increase will vary by customer and product category, with changes expected to take effect in January 2027. Mature processes, often referred to as legacy processes, typically involve semiconductor manufacturing technologies of 28 nanometers (nm) and above, which have stabilized in terms of technology and yield over time.
This will mark TSMC's first price increase for mature processes in over three years since the COVID-19 pandemic. The specific amount of the increase is expected to be finalized in the fourth quarter of this year, with industry analysts predicting a single-digit percentage rise.
Price increases have already been observed in advanced processes, where TSMC's production capacity has been constrained, leading to rising costs for key processes such as 3nm. This trend is now extending to mature processes as well.
Industry insiders attribute the demand for AI semiconductors to a broader expansion beyond advanced processes, including GPUs and high-performance computing (HPC), into the realm of mature processes like power management and power semiconductors.
Since the beginning of this year, other foundry companies besides TSMC have also raised prices for mature processes, and packaging and testing firms have followed suit, resulting in increased chip production costs. Consequently, many semiconductor design companies have reportedly raised their chip prices.
An industry source stated, "As foundry and packaging/testing costs continue to rise, chip prices cannot remain unchanged. Customers will likely pass on the increased costs to downstream companies." The source expressed concern that this could lead to a chain reaction, potentially exacerbating semiconductor inflation.
TSMC is currently in a quiet period ahead of its earnings conference scheduled for July 16 and has not commented on the rumors regarding price increases for mature processes. The company has previously stated that it determines its pricing strategy based on strategic considerations rather than opportunistic ones, emphasizing its commitment to providing value through close collaboration with its customers.
* This article has been translated by AI.
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