News TSMC Price Hikes Confirmed by Crypto Chip Giant

One thing to keep in mind about a 10-20% price hike from TSMC is that it's unlikely to result in a significant price increase to most products at retail, since the actual cost of a chip generally only amounts to a relatively small portion of the product's sale price.

Something like a Ryzen 5000 CPU, for example, already has a huge markup at retail over what AMD actually pays for the processor's chips. AMD doesn't likely pay TSMC much more than $20 for a 7nm chiplet, so even a 20% increase on that would have almost no effect on the price at retail. Even adding in the IO chip from Global Founderies, and the cost of packaging them together, the actual manufacturing costs on something like a 5800X is probably not all that much more than $50 or so. There is of course R&D costs that a company like AMD has to recoup, so the remainder is not all profit, but that part of the total cost isn't going to TSMC.

Graphics cards tend to use much larger chips, but still, a 10% price hike on the 7nm node probably wouldn't result in much more than a $10 manufacturing cost increase for a higher-end card.
 

Co BIY

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To the winner go the spoils. but...

With general inflation very high and supply problems for many inputs this seems like a modest increase.

IMO - The fact that the older nodes are increasing more than the latest nodes is an indicator that they are trying to cover cost increases more than taking profits.

I don't fault TSMC for taking a greater share of the profits. They are the ones adding the value with their process advances.

Where would the Apple M1 and AMD Zen3 be without TSMC?
 
It's not greed. The best tool that a company has, that they can use to put a damper on demand that they can't keep up with, is to raise the price. Price goes up, demand falls, and the company is able to get caught up on backorders.
Um no. If there's an 8 year back log on a 1 week backlog they are still running at full capacity.

It's greed. Monopoly in action.
 

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