Production is fine
It is always a cat and mouse game. Who can get the most out of the brand new 28nm production process?
AMD started making its 28nm chips late last year, started selling them early this year and it has roughly a one-quarter lead over Nvidia.
Nvidia is launching 28nm Kepler GTX 680 this week and we are hearing that Nvidia is pleased with its yields. Of course, Nvidia would like to have even more wafers, but TSMC cannot churn out enough of them, as it also has to service other 28nm customers.
Kepler is currently shipping to many OEMs and AIBs (Add in board partners) and traditionally AIBs were never happy with the volume of new graphics cards that they are getting.
Since Kepler performs quite well, Nvidia and its partners expect strong sales and they believe they can quickly sell all the cards that they manage can get in.
However, it seems TSMC’s transition issues are getting serious. Shifting from a manufacturing process to a new, smaller one, e.g. 40nm to 28nm is becoming increasingly problematic, we witnessed this trend in previous transitions and it now seems to be getting worse. You can expect that going to 20nm is not going to be walk in a park either.