Behind the Huawei Mate60 "domestic chip": SMIC's successful practice in mining machine chip manufacturing.

Source: TechFlow by DeepTech

Yesterday, the most explosive market information came from Huawei. During my free time, I checked my WeChat groups and found that the WeChat communities for cryptocurrency, stocks, and real estate all talked about the Huawei Mate60. Without any preheating, notification, or promotion, Huawei suddenly launched the new generation flagship phone Mate 60 Pro on its official online store under the name of "Pioneer Plan".

The most concerning thing for everyone is undoubtedly the core - where do the chips come from?

Since being added to the Entity List by the US government on May 16, 2019, Huawei has faced comprehensive technology sanctions. On September 14, 2020, TSMC completely cut off the supply of chips to Huawei, leaving Huawei without any available chips. It has been 1081 days since then.

Currently, it has been confirmed that the Huawei Mate 60 Pro will adopt the Huawei HiSilicon self-developed Kirin 9000s chip, which has 8 cores, including 4 big cores and 4 small cores, with a maximum frequency of 2150MHz, and the GPU is Maleoon 910.

Who is actually manufacturing this chip? Huahqiangbei took action immediately and a mobile phone repair anchor live-streamed the disassembly of the Huawei Mate 60 Pro, discovering that the CPU on the device is labeled as 2035-CN, with CN representing China as the place of origin. Previously, chips manufactured by TSMC were labeled as TW.

The answer is revealed: the chip Kirin 9000s in Mate 60 Pro is manufactured by SMIC.

According to screenshots shared by netizens, Kirin is using 5nm technology. However, technical experts generally believe that the 9000S is not using 5nm technology, but rather using SMIC's N+2 technology.

SMIC is the only company in China that can mass-produce 14-nanometer FinFET technology. The N+1 and N+2 processes are both based on the 14-nanometer FinFET process and are implemented using DUV lithography, bypassing the US ban. (Currently, the most advanced process requires EUV lithography.)

SMIC has not publicly stated that N+1 and N+2 are 7nm processes, but the chip industry generally believes that N+1 process is equivalent to 7nm LPE (low power consumption) process, and N+2 process is equivalent to 7nm LPP (high performance) process.

It seems that the Mate 60 Pro shipment has also revealed information about the maturity and mass production of SMIC's N+2 process. However, many industry insiders are not surprised. As early as 2 years ago, SMIC had already started to manufacture N+1 7nm chips, with their clients being Bitcoin mining companies.

In July 2022, TechInsights, a well-known reverse engineering analysis company, released a report on MinerVa Semiconductor, a Bitcoin mining company. They dismantled the dedicated chip used for mining and confirmed that it was manufactured by SMIC with a process of 7nm.

According to the MinerVa Semiconductor website, this IC has been shipping as early as July 2021, indicating that SMIC had the ability to mass-produce the 7nm process as early as the beginning of 2021.

Industry insiders have expressed to DeepTechFlow that China's leading one-stop IP and chip customization enterprise, as well as mining chip design company, Bitmain Technologies, is one of the first customers of the N+1 process of SMIC. In late 2020, MinerVa Semiconductor, a mining IC, was successfully trial-produced, with a high probability of being "handled" by Bitmain Technologies.

At the initial stage of the new process, the yield rate is usually very low. For chip foundries, it is necessary to constantly improve the yield rate in order to obtain a large number of customers. However, this requires trial and error with orders, which can easily lead to a vicious cycle.

Apple has provided significant support and cooperation to TSMC in the development of 5nm technology. In return, 50% of TSMC's 5nm production capacity is used by Apple.

SMIC does not have the same appeal as TSMC, but fortunately, it has encountered "low-end version of Apple" - chip design companies such as Jia Nan Ke Technology and Bitmain Technologies.

The mining machine chips have not only brought orders (money) to SMIC, but also provided an opportunity for SMIC to improve its yield rate.

According to the minutes of the 2021 conference call of mining machine company Jia Nan Technology, Jia Nan Technology began cooperating with SMIC in 2019. The two parties collaborated on 14nm mining machine chips, and SMIC once gave 95% of its N+1 production capacity to Jia Nan Technology.

Jianan Technology Telephone Conference Minutes 20210301

Mining machine companies naturally have a demand for advanced manufacturing processes, but that does not mean wafer foundries are willing to allocate their advanced process capacity to mining machine companies.

For example, TSMC has no shortage of buyers, with major mobile phone companies lining up to pay. However, they may not necessarily be interested in mining machine companies. The mining industry leader Bitmain once paid all fees in one go to obtain TSMC's production capacity.

Samsung has received a large number of orders from Nvidia and Qualcomm, and had previously notified that it would not accept blockchain-related orders at the end of 2020.

Mining machine companies need advanced foundries for manufacturing, and SMIC's new processes require customers. The two are a perfect match.

As for the yield rate, it may be a big issue in other chip companies, but it is not such a big problem in the mining machine industry.

According to industry insiders, mining-specific ICs have a relatively simple structure and small RAM capacity. Therefore, in the new development process, the yield rate of good products will exceed that of many other ICs.

Usually, mining chips will stack dozens or even hundreds of cores in one chip. These cores operate in parallel and are not affected by each other. Therefore, a regular chip may be scrapped due to a single unit failure, while a mining chip may only affect one core, and the other cores continue to calculate normally.

Different chips have varying numbers of faulty cores, which results in different computing capabilities. This is typically resolved through screening. Chips with stronger computing capabilities are assembled into high-end mining machines, while chips with weaker computing capabilities are assembled into low-end mining machines.

A mining machine will integrate hundreds of chips. Even if one or two chips are completely broken, it will not have a significant impact. This also leads to a high tolerance for yield rate of mining machine chips.

In short, when SMIC needed customers to test their latest N+1/N+2 processes, the mining machine chips stepped up and laid the foundation for the launch of the Huawei Mate 60 Pro today.

As a leader once said during a visit to a mining machine enterprise, ASIC chips are also chips.

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