[Chip Talk] Pass the Needle's Eye... Once Verified, You Become a 'Partner' and Take the Fast Track

Methods and Pass Rates Vary Widely
Functionality: Verifying Product Performance
Performance: Compatibility with Finished Products Is the Key Battleground
Reliability: Preventing Technology Leaks, Frequent Patent Disputes
Passing Foundry Qual Tests Is Even More Challenging
At TSMC, Even Suitable Equipment Must Be Approved by All Clients
Rising Demand for AI Semiconductors, Sixth-Generation HBM Competition
SK Hynix, Micron, and Samsung Electronics in Fierce Rivalry

"Qual has been achieved."

Even at this very moment, as readers are reading this article on June 28, dozens of semiconductor companies around the world are striving to hear this one phrase. They are pouring their efforts into passing the critical entry barrier for supplying products to clients: the "qual test" (quality verification).

The qual test refers to the process of testing the reliability of components and other parts during manufacturing to achieve a certified quality status. Originally, this term was used across all industries. Regardless of the field, every company conducts qual tests on its suppliers. However, in recent times, the qual test conducted by semiconductor companies has become a major topic of discussion, leading to the perception that qual testing is unique to the semiconductor sector. In reality, semiconductor qual tests have recently become more complex and demanding compared to those in other fields. This is due to the rise of the artificial intelligence (AI) market, which has led to an increase in qual tests for semiconductors used in AI applications, with the process itself becoming more meticulous. The qual test can determine the fate of an entire company. Passing the qual test of a prominent client instantly grants the company the status of "partner," causing its stock price to soar. Conversely, failing the test can cast doubts on the company's technological capabilities, forcing it to undergo a transitional period of reevaluating its overall business direction.

Methods and Pass Rates Vary Widely

The qual test process varies significantly from company to company. Still, there are common methods that are regarded as industry standards. Typically, the qual test begins with the supplier and client establishing a plan and preparing prototypes required for the test. After that, the full-scale testing procedures commence.

The test examines functionality, performance, and reliability. Functionality testing is the stage where it is checked whether the product performs its intended function correctly. Next comes performance testing, which mainly focuses on compatibility with the finished product the client intends to manufacture. A representative example is when Nvidia receives HBM from SK Hynix, Samsung Electronics, or Micron, installs it on its cutting-edge AI graphics processing units (GPUs), and checks if the components are compatible and the GPU chips operate smoothly. This stage is considered the most critical and challenging part of the qual test. The prevailing view in the industry is that no matter how good a product is, if it is not compatible, it is difficult to supply it to the client.

After that, reliability is assessed. This stage determines whether the technology applied to the product and the supplier itself can be trusted. For example, even after approving the qual test for products from supplier A and starting to receive their products, there is a risk of advanced technologies being leaked through A. This step is designed to prevent such incidents. At this stage, "patent disputes" often become obstacles. Sometimes, the supplier's products are similar in manufacturing method or design to those of other competitors, leading to ongoing patent litigation during the qual test. In such cases, it is not uncommon for clients to disqualify suppliers from the qual test due to patent disputes.

Once all tests are completed, the results are reviewed, and the client may request the supplier to correct any issues. After corrections are made, retesting is conducted, often multiple times. Only when the product is deemed perfect does it finally pass the test and receive certification.

"Foundries Like TSMC Are Even More Challenging"

According to the semiconductor industry, it is said that passing the qual test for foundry companies (contract semiconductor manufacturers) is even more difficult than for "AI chip makers" such as Nvidia and AMD. This is because the foundry business involves a complex web of interests.

To summarize industry insiders' explanations, in the case of TSMC, the world's number one foundry in Taiwan, if there is a need to replace even a single piece of equipment required for chip production with a product from another supplier, the company must obtain consent from every single client that has placed chip production orders. The qual test is conducted in the same manner. Even if a piece of equipment is recognized as suitable for the company's process, if even one client does not want that equipment, it cannot pass the qual test. For this reason, in the materials, components, and equipment (so-called "Sobu-jang") sector, passing a foundry qual test is regarded with the highest pride. In particular, passing TSMC's qual test for ultra-fine processes such as 1.4 nm (nanometers, one hundred-millionth of a meter) and supplying equipment is considered a monumental achievement. It is seen as something that cannot be accomplished without corresponding technological prowess.

Qual Tests to Become Even More Complex... Spotlight on HBM

The reason the term "qual test" has become widely recognized is largely due to the prominence of high bandwidth memory (HBM). News of Nvidia conducting qual tests with HBM supplied by SK Hynix, Samsung Electronics, and Micron has been widely circulated, bringing increased attention to the qual test process.

Qual testing for HBM is expected to become even more complex and demanding in the future. This is because HBM remains the hottest topic as demand for AI semiconductors continues to surge. SK Hynix, which dominates this field, recently surpassed a market capitalization of 200 trillion won (202.7487 trillion won). Micron also posted results in the third quarter of this year (February to May) that exceeded market expectations, further proving that the HBM market remains strong.

The competition for HBM has now moved on to the sixth generation, HBM4. SK Hynix and Micron are supplying samples to clients and are accelerating efforts to begin mass production within the year. Samsung Electronics is also making steady progress in qual testing for fifth-generation HBM3E with clients and is preparing to enter the HBM4 market. A head-to-head competition is expected to begin at the end of this year. After that, HBM4E awaits. As a result, a series of accompanying qual tests are expected to begin in earnest. The speed of these tests will accelerate, and the processes are expected to become even more detailed than before.