AMD: Low Yields to Stop x86-64 Processors from Becoming Popular This Year
Posted 1/16/03 at 4:17 pm by Anton
There are a lot of concerns in regards availability and pricing of AMD’s next generation x86-64 processors these days. Since AMD has been postponing their code-named K8 aka Hammer CPUs for ages now, a lot of analyst suppose that the company experiences lower than expected yields for these chips in addition to the very complex design of such devices with SOI technology. As well as everything else mentioned above, there are also rumours that AMD may launch more advanced Athlon64 processors with 1MB of L2 cache instead of the CPUs but with 256KB of cache. The move will definitely not allow AMD to offer a lot of its x86-64 products from the early beginning.
At the moment AMD’s Fab 30 can produce up to 5000 wafers per week, according to AMD’s web-site. Given that the core size of the Thoroughbred is about 84 square millimetres, we can count that from a 8-inch wafer we get about 325 cores. There is information that currently AMD’s yield for the Thoroughbred core based Athlon XP CPUs is approximately 60% (the final yield is meant here and below), thus, only 195 cores make it to become microprocessors. I remember that the original size of the Athlon64 (ClawHammer) and Opteron (SledgeHammer) core was 104 and 200 square millimetres respectively. Actual yield of new chips manufactured with different technology will not be initially higher compared to the current 0.13 micron fabrication process without SOI. Even if we consider that the yield is 50% (to my mind, it is unlikely that it will be 50%, 40 to 45% seems to be more realistic), then AMD will approximately get either 150 Athlon64 (with L2=256KB) or 78 Opteron (with L2=1MB) cores from a wafer. Keeping in mind that the cost of SOI wafer itself should be higher compared to an ordinary wafer, we can conclude that the cost of the Opteron core will be more than $30 for AMD, while Athlon64’s manufacturing cost will exceed $17. In comparison, AMD’s Thoroughbred core should cost AMD about $12 now, since the 8-inch wafer costs $2500. Add there the price AMD pays for assembly, testing, package, transport, marketing, logistics and so and you will find out the cost of AMD’s processors for AMD. It does not seem that it will be low.
Remember the rumours that there will be only processors with 1MB of L2 cache. In this case the price of the x86-64 chips will be huge or AMD will loose money selling them in order to make them more popular due to attractive pricing.
Since AMD’s gross margins are not as high as Intel’s 50%, it I do not think that the company will be able to offer a lot of x86-64 processors just after the launch or even this year. As soon as AMD tunes their fabrication process to achieve higher yields, the company will be able to deliver more CPUs, however, it is not likely to happen so soon. According to the recent publications, AMD will only be able to ship 20 000 of x86-64 processors in March and 300 000 in the second quarter. Reportedly, AMD may succeed in making up to 4 million of x86-64 CPUs in the fourth quarter; however, the overall share of the Opteron and Athlon 64 processors among all CPUs supplied by AMD next year is not likely to exceed 25%.
To sum up, do not wait for massive x86-64 processors availability next year and do not expect AMD to rapidly cut the prices of their newcomers.
Everything above was not confirmed by any official source. All the details are seem to be real and precise enough, however, such figures as yield are likely to change, causing the conclusion of this news-story to become incorrect.