Global Foundries drops planned move to 7nm production process

Last week Global Foundries announced – much to everyone’s surprise – that it was dropping all development on their much-anticipated 7nm production process, and would instead be shifting to producing silicon wafers on older nodes as well as some exotic but profitable versions of their existing processes. This has taken the industry aback quite a bit, because it now leaves just one company with a working 7nm node and everyone else struggling to keep up.

According to Global Foundries CEO Gary Patton, the chip manufacturer didn’t have any technical reason to abandon the 7nm node. Instead the company had to assess the financial viability of the move, and this includes all work going into other exotic processes as well, like the 5nm and 3nm processes on more advanced silicon layouts. Global Foundries was working on a 5nm process in partnership with IBM up to this point, but that has also been shut down as the company moves to more profitable ventures.

As Anandtech points out in their coverage on the subject, AMD isn’t affected by the move. Although they are Global Foundries’ biggest customer by far, they instead taped out and will source production from TSMC. All of TSMC’s 7nm processes are on track and running profitably, and they are currently the only company shipping a sub 10nm-class product in large volumes. TSMC, however, counts Apple as its biggest customer, and Apple routinely sucks up more than 50% of their production capacity every other year. AMD will be fighting alongside NVIDIA for production space in TSMC’s factories.

News also recently broke that a Global Foundries satellite facility was restructuring itself to increase profitability. In addition to the 5% employee layoffs announced by the company in June, plans are also in place for retrenching more than 400 employees at the company’s Malta, New York facility. It’s not a significant amount of staff worldwide, but it does amount to a drop of about 14% in staff at the facility.

With Global Foundries out of the running to a 7nm production process that leaves TSMC with 7nm-class partial EUV designs, Intel with 10nm-class full EUV designs (and struggling to increase production), and Samsung with 7nm partial EUV. The stakes get higher with each new node, and it’s looking more and more like a two-horse race. In the meantime, Global Foundries will concentrate on becoming profitable and offering access to their processes as well as assisting companies in designing their own hardware.