AMD confirms that Zen 2’s supply issues were not a “TSMC Issue”

AMD confirms that Zen 2's supply issues were not a

AMD confirms that Zen 2’s supply issues were not a “TSMC issue”

When AMD launched its Ryzen 3rd Generation lineup, demand outstripped supply, so much so that high-end SKUs like the Ryzen 9 3900X were out of stock at many retailers and saw price inflations at others. 

Given AMD’s supply issues, rumours ran wild at the cause of AMD’s early Zen 2 shortages. These rumours blamed TSMC for their inability to produce enough chips, AMD for focusing its resources on higher-margin EPYC processors and AMD’s management for relying on TSMC’s relatively new 7nm manufacturing process. 

What these rumourmongers forget is that they are not silicon manufacturers, and therefore don’t know the ins and outs of processor production. For starters, AMD is not TSMC’s largest 7nm customer. TSMC has tonnes of 7nm capacity, with 7nm acting as TSMC’s fastest node ramp to date, making allegations aimed at TSMC unwarranted. 

In a recent interview with Anandtech’s Ian Cutress, AMD’s CTO Mark Papermaster confirmed that Ryzen 3rd Gen’s early supply issues “wasn’t a TSMC issue”, stating that demand outstripped what AMD had expected and planned for. 

The long and short of this story is that AMD didn’t order enough chips to meed the early demand for its Zen 2 processors. That was why AMD couldn’t keep its processors in stock. Now, AMD’s Ryzen supply issues are seemingly at an end. Presumably, this is thanks to larger wafer orders from AMD after Zen 2’s early success. If TSMC couldn’t supply enough chips, there would still be a shortage of Ryzen 3rd Generation processors. AMD’s Zen 2 launch shortages were due to AMD underestimating demand. It’s as simple as that. 

Moving forward, AMD needs to become better at predicting demand for its processors, as Zen 2’s (Ryzen 3rd Gen’s) early supply issues resulted in a lot of missed sales and a negative brand perception. Hopefully, AMD won’t make the same mistake with Zen 3/Ryzen 4th Gen, as supply issues are always bad for consumers.   

AMD confirms that Zen 2's supply issues were not a  

As far as TSMC is concerned, AMD offers them an opportunity for significant growth over the next few years. As AMD continues to gain CPU and graphics market share, TSMC has the chance to gain market share within the foundry market. It’s in TSMC’s best interest to meet AMD’s need for cutting-edge silicon, as AMD’s growth will contribute to TSMC’s growth, assuming they remain as AMD’s foundry of choice. 

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