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    AMD's Chiplet Roadmap - the Nvidia-Arm Deal - Forecast

      Aug 25, 2021

    VLSIinsiders’ Cloudside Chat — August 25, 2021

    This week Andrea Lati, Dan Hutcheson, Jason Abt, and Risto Puhakka discuss what insiders are saying about ...

    • What is AMD doing next with chiplets?
      • What does the latest Ryzen chip reveal about what’s coming?
    • UK pumps the brakes on the Nvidia-Arm deal.
    • What’s up at Intel and new processor segmentation?
    • What’s driving continued growth in semiconductor equipment?
      • Review of VLSI’s lastest forecast.
      • Capex and chip equipment orders.

    About VLSIinsiders: Every week our analysts have a cloudside* chat to discuss current events and key issues of concern, while sharing what they’ve heard over the past week from the semiconductor industry insiders. 
    * cloudside chat: A fireside chat without the fire and is across the clouds of the internet

     

    Other VLSIinsiders

    Transcript

    VLSIinsiders' Cloudside Chat — August 25, 2021

    DAN HUTCHESON: Welcome to this week's VLSIinsiders. This is Dan Hutcheson.

    ANDREA LATI: This is Andrea Lati.

    JASON ABT: This is Jason Abt.

    RISTO PUHAKKA: And this is Risto Puhakka.

    DAN HUTCHESON: So welcome to the program, Jason. If any of you have read our press release or whatnot, we were acquired by TechInsights and Jason is the CTO of TechInsights. So, he really knows what's going on inside the chips themselves. So, we've brought him here to talk about it. So welcome to the, your first VLSIinsiders.

    JASON ABT: Thanks very much for having me. I am so glad and honored to be part of the team. It's great. I really appreciate it and can't wait to see what we can do together.

    DAN HUTCHESON: It's exciting to for us because you have a lot of really deep technical insights into what's going on. So, what is going on out there?

    JASON ABT: Well, as you said, I mean, there's so much going on, we could probably spend a couple of hours but some of the highlights that we've seen over the last few weeks really is what we seen in latest AMD Ryzen processors. So, AMD has been talking about their chiplet design now for some time. And I mean, in my view, it's really going to be a game changer in terms of performance. The bandwidth you get between the processor and the memory architecture from chiplet design should be outstanding. So, when we opened up the latest Ryzen process, which isn't yet chiplet. That's expected later this year. We were actually surprised to see that it's ready to go for a chiplet design. What do I mean by that? Well, they've actually laid out the chip with real estate for and even inclusion of the TSP matrix. So, it's raring to go I mean, it makes perfect sense in hindsight. They've de-risk some of the production it means that they can kind of stagger the release. And of course, it gives me a whole lot of confidence that, yeah, we're actually going to see production and chiplet design in GPU by the end of this year.

    DAN HUTCHESON: So that's pretty fascinating.

    JASON ABT: See, it is. The densities that we're seeing from the Ryzen is kind of jaw dropping, you know, from a production standpoint, huge complications, and you know, AMD by working with TSMC on this architecture, this design. They've overcome a lot of technical challenges, so it was it was great to see it in production.

    DAN HUTCHESON: So TechInsights also follows the IP space in a big way.

    JASON ABT: That's right.

    DAN HUTCHESON: What are you seeing there? Is there anything new with the Nvidia-Arm deal? Will you talk about that a bit?

    JASON ABT: Yeah, absolutely. So, when it was announced that SoftBank was going to be divesting ARM from their portfolio. There was a lot of speculation in the industry of where that would land, and as most people know, ARM is one of the biggest IP core providers licenses for our industry. Its ARM cores are found in everything all around us and we there last speculation of where it would ultimately land and video came out on top and it has been tracking, the deal has been tracking with an expectation of closing. However, in the last couple of weeks, perhaps a bit of a speed bump, we're hearing news out of the UK that there are now concerns from the government that you know maybe this deal isn't quite so good for ARM as a business and of course for the UK economy. So, what's going to come of it? It's hard to say. I mean my personal expectation is that yeah, the deal will end up going through. There'll be maybe some compromises made. And of course, once that happens, you know, Nvidia is in such a position of strength between it's really a world class, obviously, architecture design in parallel compute, not just in GPU, but of course, we're seeing the other architectures and other spaces and now with the inclusion of the ARM IP portfolio. Yeah, I mean they're in pretty good shape and you know it between the AMD’s success with the Ryzen and soon to be the chiplet with Nvidia. Yeah, I mean Intel, they got a lot of work to do. I mean they're Ponte Vecchio is coming soon, and from everything that we've heard is extremely high performance, but it's a pretty big bar, pretty high bar to meet. So, it's going to be a fascinating race. And I mean, it's always fun to be in this industry.

    RISTO PUHAKKA: It's quite the interesting that you know, the discussion is Intel needs to meet the bar or exceeded which somebody else set up the standard to. It's a quite a change on the discussion points so to speak.

    JASON ABT: It is and of course, you know, I, you know, Intel has shown before I mean, they, when they make the investments that they need and they combine their micro architecture, understanding, and their design expertise with the semiconductor fabrication piece of it. I mean, they can do wonders. So, you know, not at all discounted, right? They’re certainly a force to be reckoned with.

    RISTO PUHAKKA: Yeah, and the packaging use is actually exciting, just aligning to the equipment side, you know, in the sense to the advanced packaging equipment market is on fire. And of course, AMD is fab, the TSMC packaging, interconnect builder TSMC. You know, those high density PSVs take a lot of equipment.

    JASON ABT: They do.

    RISTO PUHAKKA: PVD metallization tools. So, it's a pretty interesting from that perspective as well, it's right here this year.

    DAN HUTCHESON: Yeah, so Andrea, what's going on with the forecast? You just did a new forecast update.

    ANDREA LATI: It's up again. Well, we just…

    DAN HUTCHESON: We didn't change semiconductors, right?

    ANDREA LATI: Well, we just got to know the quarterly data from both semiconductor equipment and IC makers. And, actually, as far as Q2 is concerned, our numbers were pretty much spot on, so we didn't really have to change anything in the second quarter. It was more the outlook for the equipment market, where basically we increase the forecast from 31% to 41, we're just seeing a lot of momentum there. I mean, and it's across the board. Logic is doing very well. You have foundries still very aggressive in their standing. Memory is also very, very strong. And again, it's both leading edge, trailing edge, so it’s all over the place. So basically, what ended up happening is that we ended another $8 billion in the second half, just shows you how strong the momentum has been for the equipment makers. And if you look at our order activity that we publish on weekly basis, we’re at 110 degrees. So, basically, you know, bookings are going to be much higher and I think that 42% is more than doable, given what's happening in the equipment market. On the IC market, on the other hand, we pretty much left things as they were. Q2 numbers met our expectations, and also what we're seeing there, the momentum is pretty much coming in line with our views. If anything, we're seeing a little bit of a slowing momentum, especially in the second half. But again, you know, if you compare first half of this year to last year, you know, we're looking at two different base numbers. So, you know, you have to be very careful. In the second half, things get a little bit more, you know, easy to compare, but still, you know, we're looking at about 26% growth for semiconductors, which is still a very, very high growth rate. And lastly, electronics also got a pretty nice increase from, I think, 11% to 15. Again, a lot of strength in the second quarter. But in the second half, again, we are thinking that things will slow down, because again, the base numbers change quite a bit between the two halves essentially. And we are seeing things that slowdown in certain sectors, like PCs, and some of the consumer areas. Overall, you know, great year and I think even for next year, especially on the equipment side, we are, we still expect a pretty good year with equipment growing, you know, in the high single digits. And I think that we're going to see pretty much similar performance on the semiconductor side. So yeah, so again, a little bit higher than what we thought but still within our expectations.

    DAN HUTCHESON: Yeah, it is interesting because it does there is we're seeing on the semiconductor analytics side, there's definitely a slowing, plenty of signs of slowing. But then the question is, is it a statistical artifact? Just like we're seeing with inflation where, you know, we're coming off that deep, steep decline last year and a huge jump at the beginning of this year to the rise of the second half of last year and the rise today. So, Risto, all this, all these equipment sales this year and everything, are the orders there to keep going?

    RISTO PUHAKKA: Oh, yeah, it's I mean, number one thing is actually when Andrea was describing the equipment, which crossed my mind was, you know, dangerous, it was actually supply chain constrained. You know, one concern, you know, early part of the year we were like how much the supply chain can actually deliver, equipment supply chain, and they keep increasing their capacity, you know, from that perspective able to meet those 40% numbers so and we are we have a forecast update coming along for the equipment side. It really will be released next week, just a preliminary hint, you know, the WFE going to be over 40% growth for the year, assembly equipment 50% growth for this year, test about 40% as well. Equipment service in the 30% range and next year looks about middle single digit growth rate that's basically where the numbers are settling for next year. There is a lot of momentum in the marketplace. It's…

    DAN HUTCHESON: Of course, that's all we had for this year.

    RISTO PUHAKKA: Yeah, yeah. But let me…

    DAN HUTCHESON: But we got to be honest it's been a really gentle forecasting period. You know whenever it's this far out of whack it's…

    RISTO PUHAKKA: Let me put it this way, it would be very hard to see like double digit growth rate for equipment. Of course, it can happen but it would be kind of out of the ratios big time so…

    DAN HUTCHESON: So how close are we hitting the magical $100 billion bar and crossing that?

    RISTO PUHAKKA: We are next year. I mean the $100 billion for WFE.

    ANDREA LATI: Yeah, for semiconductor equipment, we're over that. We're at $130.

    RISTO PUHAKKA: Semiconductor is $130, but WFE $100 billion, we are at this striking distance already next year. If there is a positive growth numbers, it's we can reach next year or 23.

    ANDREA LATI: Actually, what about…

    DAN HUTCHESON: I remember the big news around 1980 was that we crossed a billion dollars in semiconductors equipment so, and suddenly, we're finally going to make it to $100.

    ANDREA LATI: One point that we did debate earlier about our forecast you know when we had that 31-32% growth was really the capacity side. If the equipment market had the ability to provide enough equipment for that growth, so you know, we went back and forth, and you know, the 40% seen a little bit far-fetched initially because I just didn't think there was enough capacity in place. But apparently the equipment market and equipment suppliers have figured out a way to squeeze out whatever they can to, you know, hit those numbers essentially, because again, those are very big numbers. And again, if you look at last year, equipment market was already up about 18% or so. So, it's coming off of a very good year to begin with. It's not the decade of, you know, downturn so.

    RISTO PUHAKKA: One thing you have to remember that what the Jason said the products like the AMD’s, the new GPU, those drive equipment sales. I mean, that's going to be a hot product out there, if it’s already not, but you know, that's really the key driver.

    DAN HUTCHESON: Yeah, you know, that's the fun thing about it is what reminds me of is those early 80s when there was just new technology after new technology and after new technology and it was just driving an explosion equipment. And then we went to that dull period in the 90s and 2000s, where everything was about productivity and it shrunk the equipment market. And now the technology demands are what's driving a much larger equipment market going forward.

    JASON ABT: Yeah, absolutely. I mean, we're certainly not going to be in any kind of a stagnant period from a technology innovation standpoint. Dan, you and I were talking just beforehand that, I mean just looking at the processor market it is it is segmenting like mad right now. And we're going to see is optimization in each of these different segments and even just in terms of hyper fabrication, which of course is going to just drive demand for the equipment all the more. I mean, PSV in my mind is just the beginning and we're, you know, a hair's breadth away from going from FinFET to get all around and beyond. It's exciting times.

    DAN HUTCHESON: Yeah.

    RISTO PUHAKKA: Yeah.

    DAN HUTCHESON: Well, we've run out of time guys. Thanks again for doing this with me. I really appreciate it.

    RISTO PUHAKKA: Thank you Jason. We’re going to have fun years ahead of us with your technology side and our market statistics.