Average TSMC silicon wafer price soar y-o-y in Q4 2023

News Analysis




Average TSMC silicon wafer price soar y-o-y in Q4 2023

  • Kyle Pronk

Following a year of decreased silicon wafer shipments in 2023, Taiwan Semiconductor Manufacturing Company (TSMC) sees yearly revenue remain strong owing to an increase in revenue from 3nm technology.

The semiconductor market experienced a slump in 2023, shipping fewer silicon wafers per quarter for the first time since 2020. Despite a downturn in the market, TSMC reported only a slight decrease in revenue and that average silicon wafer prices had increased y-o-y.

TSMC attributed their stability to an increase in revenue share of their 3nm technology, which accounts for 6% of their Q4 revenue in 2023. TSMC has an advantage in the market, able to leverage its almost exclusive position over 3nm technology for higher revenues. These high-end nodes cost substantially more than their low-performance counterparts, with 3nm technology fetching an average price of ~US$20,000, and the 2nm technology set to be priced around ~US$25,000.

With export restrictions of chip-making equipment from the US and the Netherlands imposed on China in 2022/2023, Chinese chip manufacturers have been limited to constructing lower-end technologies, notably 28nm which cost an average of US$3,000 per wafer.

Given TSMC’s dominant position in the market, they will remain a key player in the semiconductor chain and can justify higher price tags for their technological edge over rivals. Other chip makers such as Samsung have weighed in, stating they will begin mass production of their 3nm (GAP) node by 2024. However, TSMC remains on top, with Samsung’s yields less than 20%.