AMD transferred production of virtually all of its substantial products to TSMC in the recent years and it is in no hurry to add other manufacturing partners, according to Lisa Su, chief executive officer of AMD, who recently visited Taiwan. Despite rumors that AMD might shift some of its orders to Samsung Foundry, the head of AMD does not seem to be ready to make any concrete comments on the matter.
"We typically do not publicly comment on the details of specific products and orders, but TSMC is an important partner," Su said in Taiwan when asked to comment on the rumors about working with Samsung Foundry, according to a report by BusinessKorea. "The Instinct MI300, a world-class accelerator for generative AI that AMD plans to launch later this year, has high complexity."
While on paper fabless chip designers can work with multiple foundries, this is usually associated with a lot of curbs. First, modern process technologies from different contract chipmakers are not compatible — a 5nm-class chip made by TSMC has to be redesigned to be produced at Samsung Foundry. When we are dealing with complex products such as AMD's Instinct MI300, such redesign costs may get too high.
Second, fabless chip developers tend to reuse IP across different product lines to save costs and usage of multiple foundries limits this capability or at least reduces its appeal. Third, when you buy in huge volumes from one supplier, you are going to enjoy various benefits, including tailoring of process technologies for your needs and discounts. Of course, some companies — such as Qualcomm — can afford to work with multiple contract chipmakers and benefit from it, but this is because they buy huge amount of chips from everyone.
"We will continue to work with our Taiwanese partners because we cannot launch this product without good partners like TSMC," Su added, underlining the importance of TSMC for the company.
However, Su sounded less resolute when she visited Tokyo later that week.
The head of AMD told Nikkei that the company would "consider other manufacturing capabilities" besides TSMC to produce its chips to "ensure that we have the most resilient supply chain."
Meanwhile, TSMC is building up fabs in the U.S. and Japan, which will inevitably ensure resiliency of its supply chain. Therefore, AMD may not be exactly inclined to work with TSMC's rivals like Samsung Foundry and Intel Foundry Services for the reasons mentioned above. At least for now.
