TSMC Roadmap Update: N3E in 2024, N2 in 2026, Major Changes Incoming

Taiwan Semiconductor Manufacturing Co. has solid plans for the next few years, but the foundry's manufacturing technology design cycles are getting longer. As a result, to address all of its clients' needs, the company will have to keep offering half-nodes, enhanced, and specialized versions of its fabrication processes.TSMC's success in the last 20 years or so was largely conditioned by the company's ability to offer a new manufacturing technology with PPA (power, performance, area) improvements every year and introduce a brand-new node every 18 – 24 months while maintaining predictably high yields. But as complexity of modern fabrication processes gets to unprecedented levels, it is getting much harder to keep the pace of innovation while also sustaining predictable yields and simple design principles.With TSMC's N3 node, the gap between N5 (5 nm-class) ramp up and N3 (3 nm-class) ramp up will increase to around 2.5 years, which may pose some challenges to the foundry's key customer, Apple. The good news is that N3's follow up, N3E, seems to be coming in ahead of schedule. Meanwhile, with N2, the cadence is set to stretch to about three years, which largely means a strategic shift in TSMC's strategy of node development.