Η GlobalFoundries he said on Monday a significant change in its strategic planning. The company, which also makes AMD processors, has announced that it will stop developing the 7nm manufacturing method indefinitely, with the aim of focusing on more specialized builds, with the 12nm and 14nm methods already available. The result of this change in the design of the company will be a reduction of its staff by 5%, while it intends to renegotiate its existing agreements with AMD and IBM.
As the company explains, the reasons that led it to this choice, are purely economic and not some problems with the 7nm manufacturing method that it has been developing lately, having already spent billions on this method. Naturally, the company canceled its future plans for manufacturing methods at 5nm and 3nm.
The development of new construction methods requires increasing investments, investments of many billions of dollars. At the same time, the company's customers must be assured that the investments will continue and that they will be able to continue to rely on GlobalFoundries, that it will always be able to provide them with a state-of-the-art manufacturing method. If they can not provide such a guarantee, they may transfer their plans to other companies. However, with GlobalFoundries not having a significant number of factories, the cost of developing new manufacturing methods could not be easily covered. The company would have to cost its technology dearly, which would make it uncompetitive with other manufacturers, notably TSMC and Samsung. If we add to this the road race between Samsung and TSMC, it is rather easy to understand that GlobalFoundries could not follow.
One of the companies affected by the above GlobalFoundries strategy change, is AMD. The company, however, seems to have been aware of or even suspected of this development, revealing a month ago that the second generation EPYC processors will be manufactured in TSMC factories, while it had already demonstrated a Vega GPU built in TSMC at 7nm.
Following the above development regarding GlobalFoundries, it is logical that AMD transfers the majority of its future products to TSMC, leaving an open window for cooperation with Samsung. GlobalFoundries will continue to produce, for as long as necessary, the first generation Ryzen and EPYC processors. However, no delays are expected in the availability of future AMD products.
