GlobalFoundries Scraps High-Tech 7nm Chips, Citing No Demand

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Major semiconductor manufacturer GlobalFoundries scrapped the development of its 7nm process node technologies, citing a lack of demand. The company's 7nm FinFET project is now formally described as being indefinitely on hold, with the chipmaker also resolving to largely restructure its research and development unit in order to account for the strategy shift and do a better job at supporting the products it's still looking to maintain and continue advancing moving forward. The move will see its focus shift to less capable but production-ready 14nm and 12nm FinFET programs and related solutions, the company confirmed.

Chief Executive Officer Tom Caulfield who toom over GlobalFoundries earlier this year described the development as the latest step in the firm's endeavors to maximize the potential of every technology generation and make sensible investments so as to ensure its long-term sustainability. With process nodes now effectively becoming "design platforms" with a much broader range of use cases than what has been the case with yesteryear solutions, these technologies now offer "greater longevity," Mr. Caulfield argued as part of a prepared statement on Monday. GlobalFoundries is now adamant to pour the largest volume of its resources into areas that their clients find the most relevant instead of pushing for them to buy new, more expensive solutions that are still far from maturity, according to the CEO.

GlobalFoundries has been investing in 7nm tech since 2016 and also won't be pursuing more advanced solutions such as 5nm process nodes in the immediate future. Other major fabless manufacturers such as Samsung and TSMC could consequently increase the prices of their own 7nm solutions, provided that GlobalFoundries' move results in a larger demand for their products, which may not be the case if Mr. Caulfield's assertion about an overall lack of demand among its customers is accurate. The upcoming Snapdragon 845 successor will be based on TSMC's 7nm process node, whereas Samsung's Exynos 9820 will also utilize a similar technology, albeit enhanced through the use of cutting-edge extreme ultraviolet lithography. Both chips are expected to be announced late this year and start appearing in smartphones in early 2019.

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