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These Technology Shifts Are Impacting Semiconductor Stocks

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Part 6
These Technology Shifts Are Impacting Semiconductor Stocks PART 6 OF 12

Why Chipmakers Are Developing Advanced Chips without Moore’s Law

Foundries change strategy as Moore’s law slows

As the cost of manufacturing is increasing with the reduction in the die size, foundries are looking to increase wafer sizes. A few fabrication facilities or fabs now use the 300 mm (millimeter) wafer, and SEMI expects two or three fabs to start volume production on a 450 mm wafer in 2022, one of which would be in China (MCHI).

Why Chipmakers Are Developing Advanced Chips without Moore’s Law

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Multi-Layered 3D design

With the slowdown in Moore’s law, chip companies are building multi-layered chips and switching from 2D planar to 3D designs to improve performance. This 3D technology is material intensive.

Samsung (SSNLF) plans to invest $18 billion by 2021 to expand its semiconductor manufacturing capacity. It plans to spend $13.5 billion on a 3D NAND (negative AND) facility and $5 billion on fabs. Intel (INTC) is investing $2.5 billion on a plant that will manufacture 3D non-volatile memory.

Micron Technologies (MU) is investing in the production of 32-layer MLC (multi level cell) and TLC (triple level cell) 3D NAND chips.

Multi-chip module

Meanwhile, chip designers are also looking to make MCMs (multi-chip modules), in which they place different types of chips on the same die. Micron Technology’s MCP (multi chip module) puts DRAM (dynamic random access memory) and NAND on the same chip, eliminating the need to buy two memory chips separately and reducing power consumption and manufacturing costs.

Tech companies are also moving from individual chips to custom SoCs (systems-on-chips) developed for specific purposes. Qualcomm’s (QCOM) Snapdragon SoC consists of ARM processor, graphics processor, and connectivity modem.

Quantum computing

Apart from the above technologies, HP Inc. (HPQ), IBM (IBM), Microsoft (MSFT), and Intel are doing research on the next level of computing, or “quantum computing,” which would revolutionize the world of computing. The first company to commercialize quantum computing successfully is likely to grow significantly.

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