Barely weeks after the world's largest chipmakers predicted that the ongoing supply side crunch would continue for at least another year, one of them has now revealed that they actually managed to overcome some of the problems associated with the manufacture and supply of microprocessors.
Chip designer AMD has claimed that it managed to skirt most of the problems that led to the global chip supply crunch through a time-tested method. It simply planned better and forecast demand many years in advance, a company official has revealed on the sidelines of a Web summit.
A media report quoted AMD's chief technology officer Mark Papermaster to suggest that the company's supply chain team worked hard to forecast demand patterns for several months and years and built it into their manufacturing and supply chain. In spite of the squeeze in supply, AMD managed to snatch market share from arch rival Intel in both PCs and servers powered by the latest line of processors.
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Recently, TSMC CEO Dr. C.C. Wei had confirmed that its foundry production capacity was insufficient to satisfy the demand for its chips, especially orders for components used for high-performance computing (HPC) systems and 5G devices using the company's 5nm process node.
Meanwhile, rival semiconductor fabricator Samsung, has begun negotiations to invest $17 billion into a second semiconductor foundry in Texas, in addition to increasing investment in its current plant in Austin to boost capacity. On its part, Intel is set to spend around $20 billion to build two new foundries in Arizona.
The AMD official said while everyone had to focus harder on the supply chain, they did so from the very beginning of the pandemic as a result of which they could send early demand prediction to chip fabricators such as TSM to guarantee steady supply.
Since AMD doesn't manufacture its own chips like Intel, it depends on companies such as TSMC and GlobalFoundries to make them. However, the company uses top notch semiconductor nodes and generate a high level of demand in this area, which in turn secures the supply chain, the AMD official was quoted as saying.
The company has focused on high-margin chips that allows them to better channel their resources and ensure higher revenues on a yearly basis. This year, AMD sees a revenue increase to the tune of 65 percent.
The company had clocked a record-setting quarter piggybacking on the doubling of data center sales, with a significant increase in the shipments of the third-gen EPYC Milan processors. Its revenues grew 54 per cent year-on-year in the July-September quarter while operating income doubled during the period.
Things could get better for AMD as the federal Indian government has sounded out chipmakers like AMD, Intel and United Microelectronics to set up manufacturing in the country. We had reported earlier that the plan is being coordinated from the Prime Minister's office and the government is ready to go the extra mile to get these giants on board, through the PLI (Performance Linked Investment) Scheme that has provided some impetus to manufacturing in other sectors.
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