Amd has margin to reduce the production costs of its chips
Table of contents:
Production costs are very important in the manufacture of chips. AMD has scope to cut costs. Inside, the details.
There is a fierce battle to cut costs in the chip manufacturing industry. This problem is faced by Intel and AMD, although the latter has been achieved through the "Matisse" MCM chiplet design. The red giant presented two slides in his keynote this year proving this fact. Below, we explain in detail the difference that this cost reduction has made.
Saving production costs, the key to AMD
At this year's IEEE ISSCC AMD showed two slides demonstrating that the company reduces costs by adopting MCM (multi-chip module) for EPYCs, HEDT processors, and desktops. The "red beast" manages to maximize the 7nm allocation by producing 8 small CCD cores that add up to AMD's target on the number of cores.
To do this, AMD limits the components that benefit from the silicon manufacturing process (cores) and allows other components to settle at 12nm. This strategy allows AMD to offer up to 16 cores in the AM4 socket on its desktop chips, as well as up to 64 cores in the sTRX4 or SP3r3 sockets .
In these slides, AMD compares the cost of production of the current 7nm + 12nm MCM strategy with a hypothetical one in which it had to build 7nm. The conclusions drawn are that the cost of a single chiplet "Matisse" MCM, (for example, the Ryzen 7 3700X) is almost 40% less than that of a double chiplet (Ryzen 9 3950X).
Possible price drop
So if AMD were to choose to build a 7nm monolithic array that had 8 core s, it would cost almost 50% more than the current strategy. Also, a 7nm termination with 16 cores and I / O components would cost 125% more. So AMD has a huge margin to cut costs. Production prices for its flagship 3950X may start at $ 749, but AMD can further lower its production price to $ 499. This would also apply to Ryzen 5 chips.
Be careful with this because AMD manages to reduce production costs would mean a decrease in acquisition prices. The translation would be a possible price drop.
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