TSMC expanding capacity for Nvidia’s AI chips
Yes gaming GPUs haven't been great, but TSMC is having to expand its high end production
As GPU shipments might be falling, TSMC is in fact having to expand its advanced packaging demand capacity to accommodate Nvidia’s expanding AI GPUs. So although you might think demand has been falling according to JPR, some sectors haven’t exactly seen the same slowdown.
Digitimes reports on what TSMC plans to do for the years to come. And in particular, the rise of artificial intelligence, high-performance computing, and PCs has been improving rapidly over the years. So with the popularity of the likes of Nvidia’s A100 or H100 and improvements showcased at Computex 2023, TSMC needs to increase production of these advanced packaging chips.
These more advanced graphics cards utilize a different production method than gaming cards. With a chip on wafer substrate with a layered design. Where it also features faster HBM memory directly on the die compared to slower GDDR on the board rather than the chip. As such it is a more expensive process but a much faster option.
So for this expansion, TSMC is reportedly offering Nvidia 10,000 more CoWoS wafers through 2023. Each one provides around 60 A/H100 GPUs per wafer so in total would provide an additional 600,000 data center graphics cards.
According to the same report, the CoWoS output is around 8-9,000 wafers per month. So an increase of nearly 2,000 for Nvidia is really going to strain what TSMC can provide as it fills in the current capacity it needs to expand on what it can produce monthly for the growing market.
All of these are likely to fulfill the growing demand for the high end GPUs for servers and AI. And to expand what current options have, such as Oracle buying plenty of chips for its expansion in the cloud. So with plenty more demand, it’s not surprising TSMC is expanding, even when the gaming market is slowing down.
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