TSMC on Friday revealed more details regarding an incident with a photoresist material at its Fab 14B earlier this year. The contaminated chemical damaged wafers on TSMC’s 12 nm and 16 nm lines, and the company now expects the full impact of the event to reduce their revenue by a whopping $550 million in the first quarter.

TSMC said that a batch of photoresist it used included a specific element which was abnormally treated, creating a foreign polymer in the photoresist. The problem was detected late when the wafer yeilds were lower than expected. As it turns out, consequences of the photoresist incident at Fab 14B were more serious than initially calculated by TSMC. There are media reports claiming that between 10,000 and 30,000 wafers were affected and had to be scrapped, but TSMC has never confirmed either of the numbers.

According to media reports, the affected companies include HiSilicon/Huawei, NVIDIA, and MediaTek, but TSMC has not disclosed names of its customers that suffered from the incident. The only thing that TSMC does confirm is that it has already negotiated new delivery scheduled with its customers.

In any case, the cost of the wafers totals $550 million and they will be made up in Q2. In the meantime, TSMC is pulling in "certain production" from Q2, which will bring in $230 million in additional revenue in Q1. As a result, TSMC’s first quarter earnings are now expected to be between $7 billion and $7.1 billion, down from $7.3 - $7.4 billion predicted in mid-January.

In a bid to avoid similar situations in the future, TSMC will make inspection of incoming materials more thorough and will strengthen inline wafer inspection. The company also indicated that it will need better controls because of increasing complexity of leading-edge fabrication technologies.

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Source: TSMC

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  • Manch - Wednesday, February 20, 2019 - link

    Yes they're AMD designs but Sony and MS own their respective iterations. This came about bc when MS used Intel /Nvidia for the original XBOX they had to abruptly stop bc both no longer made their chips. So the original XBOX disappeared over night. In order to not be put into that position again, they wanted to own their design.
  • happily1986 - Wednesday, February 20, 2019 - link

    The simpler thing for TSMC to do here is to go after it’s resist supplier. Doing an insurance claim is very straight forward but the premiums thereafter to be paid will be elevated cos of the payout, not a wise move in the long run right?
  • TristanSDX - Wednesday, February 20, 2019 - link

    wafers with Zen 2 was damaged, that is why AMD posponed launch
  • porcupineLTD - Wednesday, February 20, 2019 - link

    Did you read the article?
  • Valantar - Wednesday, February 20, 2019 - link

    1) Has AMD postponed the launch of Zen 2? If so, can you show me a source for this? From all their public statements that I've seen, Zen 2 is on track.

    2) So you're accusing TSMC of lying to investors, then? Given that AMD only uses the 7nm node from them, and they're explicitly saying this only affected 12nm and 16nm, that would indeed be an outright lie - which at least in the US is grounds for a lawsuit.
  • Simon_Says - Wednesday, February 20, 2019 - link

    Unexpected benefit for AMD for sticking with GloFo 14nm for the IO dies.
  • Samus - Wednesday, February 20, 2019 - link

    Fab 14B doesn’t produce 7nm...this event only affects Fab 14B where the tainted photoresist was used.
  • Arbie - Wednesday, February 20, 2019 - link

    Of course it didn't read the article. It's just a troll. Ignore.
  • scineram - Thursday, February 21, 2019 - link

    Anandtech, why not delete shit like this?
  • eastcoast_pete - Wednesday, February 20, 2019 - link

    @Anton, thanks for this follow up story. I strongly suspect that this screw up was due to reduced QC at TSMC. That company must be under enormous pressure to generate the revenue to pay the loans off TSMC had to take out to pay for its new flagship 7 nm Fab, so economizing is high on the agenda. Cutting QC is one of those cuts that tends to be made in those situations.
    Yes, the supplier or shipping company messed up first, but any Fab that knows its business won't take a supplier's analysis sheet at face value - not for a mission critical step like photolithography.

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